questions for the final presentation

Which of the following best describes an insured asset allocation strategy:     1)  a long run strategy that takes into account global investing   2)  a strategy that adjusts the portfolio mix as capital market expectations change   3)  a strategy that examines capital market conditions and the investor's objectives to establish a portfolio mix.   4)  none of the above

Explain

Explain Systematic (market risk) and Business-specific risk. Can diversification of the portfolio reduce each? please explain to me as simply as possible.

The recent financial crisis clearly depicted a positive correlation between asset prices and, as a result, could warrant consideration for optimal portfolio strategies. Why would an investor prefer a constrained portfolio optimization approach?

How does the Arbitrage Pricing Theory (APT) differ from and complement the Capital Asset Pricing Model (CAPM)? The Arbitrage Pricing Theory, developed by Stephen Ross, proposes that an asset's returns can be predicted using the linear relationship between the asset's expected return and a number of macroeconomic factors. Unlike CAPM, which uses a single factor (market risk), APT allows for multiple factors to explain asset returns, potentially providing a more comprehensive risk-return framework. These factors might include inflation, GDP growth, interest rates, or market indices. APT is based on the principle that arbitrage opportunities will be eliminated in efficient markets, leading to a pricing equilibrium. While more flexible than CAPM, APT faces challenges in identifying and measuring relevant factors. The theory has important implications for portfolio management, asset valuation, and our understanding of risk premiums in financial markets.

accounting answer need

What does Jensen's alpha measure? a. An investor's reward in proportion to their assumption of systematic risk b. The abnormal return of an asset, defined as the degree to which its actual return exceeds that predicted by the capital asset pricing model c. The degree to which diversifiable risk is eliminated d. How much reward an investor is getting for each unit of risk assumed

Required account answer

Which of the following is NOT a way to to reduce revenue portfolio risk? Group of answer choices Revenue diversification Reducing the proportion of a riskier revenue Relying on a single revenue source Increase the proportion of a more stable revenue source

Which of the following types of risk is NOT reduced by portfolio diversification? Multiple choice question. Unsystematic risk Unique risk Systematic risk Neither systematic risk nor unsystematic risk is reduced

Portfolio expected return and risk A collection of financial assets and securities is referred to as a portfolio. Most individuals and institutions invest in a portfolio, making portfolio risk analysis an integral part of the field of finance. Just like stand-alone assets and securities, portfolios are also exposed to risk. Portfolio risk refers to the possibility that an investment portfolio will not generate the investor’s expected rate of return. Analyzing portfolio risk and return involves the understanding of expected returns from a portfolio. Consider the following case: Andre is an amateur investor who holds a small portfolio consisting of only four stocks. The stock holdings in his portfolio are shown in the following table: Stock Percentage of Portfolio Expected Return Standard Deviation Artemis Inc. 20% 6.00% 31.00% Babish & Co. 30% 14.00% 35.00% Cornell Industries 35% 11.00% 38.00% Danforth Motors 15% 3.00% 40.00%   What is the expected…

Multinational companies, international portfolio diversification are known to offer moreopportunities than a domestic portfolio. Further, they have more stable returns despitehaving more diffuse risk.Required:A. What factors are responsible for the recent surge in international portfolioinvestment?B. Explain the main barriers to international portfolio diversification.C. Discuss the advantages and disadvantages of investing in emerging economies.

Need answer

This question relates to the two types of risk and to diversification. a)What is specific risk?  b)What is market risk?  c)What is meant by diversification?  d)Explain why diversification is a useful tool to manage specific risk but not market risk.  Be sure you answer clearly both why diversification can help manages specific risk as well as why it is not useful in managing market risk. e)Approximately how many stocks in a portfolio do you need to be fully diversified?

Which of the following investment strategies involves generating a higher expected rate of return through increasing risk? a. Leverage b. Value at risk            c. Diversifying d. Hedging risk