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Diversification and the Reduction of Dispersion: A Note

G. A. Whitmore

Journal of Financial and Quantitative Analysis · 1970 · Volume 5 · Issue 2

DOI: 10.2307/2329850

Abstract

Recently, several researchers, including Evans, Archer [1], Latané, and Young [2], have performed empirical analyses of the relationship between the number of securities in a portfolio and the reduction in portfolio dispersion. In this note, an exact mathematical relationship between these two factors is presented.

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