International Diversification and Risk The total risk of any portfolio is therefore composed of systematic risk (the market) and unsystematic risk (the individual securities) Increasing the number of securities in the portfolio reduces the unsystematic risk component leaving the systematic risk component unchanged 制计爱价货易大考International Diversification and Risk „ The total risk of any portfolio is therefore composed of systematic risk (the market) and unsystematic risk (the individual securities). „ Increasing the number of securities in the portfolio reduces the unsystematic risk component leaving the systematic risk component unchanged