What is the effect on portfolio beta of a larger number of assets in a portfolio and a longer time period?

A) It is less stable.
B) It is more stable.
C) It is more consistent.
D) It is less consistent.

According to the diversification rule, a larger number of assets in a portfolio leads to lower portfolio beta and hence, a more stable portfolio. Similarly, a longer time period also leads to a more stable portfolio by reducing the impact of short-term fluctuations. Therefore, the combination of a larger number of assets in a portfolio and a longer time period results in a more stable portfolio beta.