True/False
A stock might be quite risky if held by itself, but if much of this total (stand-alone) risk can be eliminated through diversification, then its relevant risk-that is, its contribution to the portfolio's risk-is much smaller than its irrelevant risk.
Correct Answer:
Verified
Correct Answer:
Verified
Related Questions
Q2: Short-term investments have higher maturity risks as
Q3: The probability distribution of the payoffs on
Q3: In a given portfolio, replacing an existing
Q4: A portfolio is made up of Stocks
Q6: Which of the following statements about market
Q7: Other things held constant, if the investors
Q9: The risk-free rate of return is 4%,
Q10: The standard deviation of the returns of
Q11: Assume you are considering combining two investments
Q32: A stock has a beta coefficient, β,