According to Efficent Market Theory, which of the following statement regarding individual investor behavior is most likely NOT true ? a. Employees tend to overinvest in their company's own stock. b. Individual investors' portfolios consistently outperform the market averages. O c. A vast majority of individual investors hold fewer than 10 stocks in their portfolio. O d. Individual investors fail to diversify their portfolios adequately.

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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According to Efficent Market Theory, which of the following statement regarding individual investor behavior is most likely NOT true ?
a. Employees tend to overinvest in their company's own stock.
b. Individual investors' portfolios consistently outperform the market averages.
C.
A vast majority of individual investors hold fewer than 10 stocks in their portfolio.
d. Individual investors fail to diversify their portfolios adequately.
Transcribed Image Text:According to Efficent Market Theory, which of the following statement regarding individual investor behavior is most likely NOT true ? a. Employees tend to overinvest in their company's own stock. b. Individual investors' portfolios consistently outperform the market averages. C. A vast majority of individual investors hold fewer than 10 stocks in their portfolio. d. Individual investors fail to diversify their portfolios adequately.
Which of the following is NOT a diversifiable risk?
a. The risk that a new product will not receive regulatory approval
O b. The risk of a key employee being hired away by a competitor
C.
The risk that oil prices rise, increasing production costs
O d. The risk of a product liability lawsuit
Transcribed Image Text:Which of the following is NOT a diversifiable risk? a. The risk that a new product will not receive regulatory approval O b. The risk of a key employee being hired away by a competitor C. The risk that oil prices rise, increasing production costs O d. The risk of a product liability lawsuit
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