Multiple Choice
Diversification refers to the _____.
A) reduction of the stand-alone risk of an individual investment, measured by its beta coefficient, by combining it with other investments in a portfolio
B) reduction of the stand-alone risk of an individual investment, measured by the standard deviation of its returns, by combining it with other investments in a portfolio
C) reduction of the systematic risk of an individual investment, measured by its beta coefficient, by combining it with other investments in a portfolio
D) reduction of the systematic risk of an individual investment, measured by the standard deviation of its returns, by combining it with other investments in a portfolio
E) reduction of the unsystematic risk of an individual investment, measured by its coefficient of variation, by combining it with other investments in a portfolio
Correct Answer:
Verified
Correct Answer:
Verified
Q18: Market risk refers to the tendency of
Q35: Which of the following statements about beta
Q37: Which of the following risks is relevant
Q39: Which of the following statements about the
Q41: For Investment A, the probability of the
Q42: Risk refers to the chance that some
Q43: For a risk averse investor, other things
Q44: Darren has the option of investing in
Q45: Which of the following statements about the
Q53: Which of the following is a measure