True/False
While the portfolio return is a weighted average of realized security returns, portfolio risk is not necessarily a weighted average of the standard deviations of the securities in the portfolio. It is this aspect of portfolios that allows investors to combine stocks and actually reduce the riskiness of a portfolio.
Correct Answer:
Verified
Correct Answer:
Verified
Q23: Companies should deliberately increase their risk relative
Q24: Diversifiable risk, which is measured by beta,
Q25: Portfolio A has but one security, while
Q26: Other things held constant, (1) if the
Q27: Since the market return represents the return
Q29: Which of the following statements is most
Q30: We will generally find that the beta
Q31: Portfolio diversification reduces the variability of the
Q32: If the expected rate of return for
Q33: If we develop a weighted average of