I saw a practice question asking about the whole “diversified/non-dive...

The practice question likely gives the following four answer choices: diversified open-end fund, diversified closed-end fund, non-diversified open-end fund, and non-diversified closed-end fund. Assuming the portfolios are the same, we can determine which of the four is most aggressive and which is most conservative. First, closed-end funds typically use leverage, increasing their risk to investors. Second, diversification reduces many investment risks, making a non-diversified fund riskier than a diversified fund. Therefore, the most aggressive of the four is the non-diversified closed-end fund. The most conservative is the diversified, open-end fund.