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Answer: are good controls on overconcentration.
Position limits are maximum allowable positions in specific securities, sectors, or asset classes. They serve as effective controls against overconcentration risk by preventing excessive exposure to any single investment or market segment.
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Position limits:
A
take volatility into account.
B
are good controls on overconcentration.
C
require a reduction in the size of a portfolio when a loss of a particular size occurs in a specified period.
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