Select the correct answer.

Which investor is making a common investment mistake?

A. Sami strategically divides his portfolio among different asset classes.
B. Lee invests his money in the most popular industries he's aware of.
C. All has been investing some of his money in index funds.
D. Alex plans to invest most of her money in international stocks.

Financial investors should focus on diversification to minimize risk. Mutual funds and index funds are investment options that provide diversification and are managed by professionals.

Explanation:

Diversification is crucial for financial investors as it spreads risk across different investments to minimize losses. Mutual funds pool money from multiple investors to invest in a diversified portfolio, managed by professionals. Index funds track a specific market index, offering broad diversification and typically lower fees compared to actively managed funds.

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