Why should investors invest in stocks of different or unrelated industries? Is it true that all investment risks can be eliminated by investing in more stocks? 

unsystematic risk is a risk associated with investment into a particular asset or a particular sector that will expose the investor to firm specific risk, so investor will be trying to build a Portfolio and invest into various different stock with different sector in order to eliminate the risk of unsystematic nature, so it will provide the investor with better risk reward ratio as he will be trying to eliminate the unsystematic risk and we will enhance the ability of maximization of rate of return also.

This process of diversification is generally followed in investment field as it will be helping the investor in order to eliminate the unsystematic risk by enhancing the portfolio through elimination of firm-specific risk so he will be trying to maximize his rate of return through minimising of risk.

It is not true that all the risk can be eliminated because systematic risk or the market risk which is majorly due to the market related factors can never be eliminated by the investors through diversification and investor will have to face it.