of investor prefer fixed income

Q: Investors require a _____ return as compensation for taking ____ risk. A) higher, margin B)…

A: Risk is the possibility that the actual return on any investment made might be different from the…

Q: Which of the following is a constrain for the investors? a. The mentality tontake the high risk b.…

A: Investing is a critical component of wealth growth. It enables the investor to fight inflation,…

Q: What is risk? Although many risks (e.g., career risk, risk of how many children to have and whether…

A: The risk may be defined as the possibility of uncertain events that can be harmful to the…

Q: The capital asset pricing model (CAPM) contends that there is systematic and unsystematic risk for…

A: Introduction : In simple words, capital asset pricing model or CAPM can be understood as a valuation…

Q: o risk premiums influence financial decisions regarding risk and re

A: Step 1 A risk premium is an investment return that is expected to generate more than the level of a…

Q: How does the emergence of interest-rate risk helpexplain financial innovation?

A: Interest rate risk is defined as the risk that is faced by the bond holders because of the changing…

Q: What is overconfidence bias in investing? Give examples and how to overcome it. Thank you!

A: Explanation:- Overconfidence bias in investment causes people to overstate their knowledge about…

Q: will you suggest to a relative, to invest in a low risk outlet such as the money market or to a high…

A: In this we have to choose between the debt and equity and choose the proper based on our risk…

Q: How is risk defined and measured? How might the magnitude of the market risk premium impact…

A: In financial terms, the risk is referred to as the possibility that an outcome's actual gains will…

Q: Under prospect theory, the shape of the utility function implies that investors are

A: Under prospect theory, the shape of the utility function implies that investors are: (A) Always risk…

Q: The calculation of an investor's Risk Aversion (A) requires us to look at that individual investor's…

A: A key idea in finance and investment theory, risk aversion examines how investors behave and what…

Q: What happens to the price and return of a security when investors recognize it as undervalued?…

A: Undervalued-If a security is selling in the market at a price below its true intrinsic value, then…

Q: How can an investor eliminate Unsystematic Risk?

A: There are two types of risks: 1) Systematic risk 2) Unsystematic risk. Systematic risk is non…

Q: How can an investor eliminate Systematic risk?

A: There are two types of risks: 1) Systematic risk 2) Unsystematic risk

Q: Explain what is meant Market Risk and by Specific risk. How can an investor reduce these risks?

A: Risk is referred to as the chance that an outcome or an investment's actual gains will differ from…

Q: What is idiosyncratic risk? How does it differ from market risk?

A: Idiosyncratic risk or unsystematic risk or specific risk is that risk which belongs to specific…

Q: Explain what is the criterion used by a rational investor for choosing a financial investment in…

A:

Q: What are the differences between stocks and bonds in terms of predicted future payments? Which sort…

A: Introduction: A bond is a financial security issued by a firm or government to borrow long-term cash…

Q: What is the difference between future value and present value? Which approach is generally preferred…

A: Present value and future value are considered while taking investment decisions. The future values…

Q: Why are investors risk-averse? How can investors deal with different degrees of risk?

A: In the world of investment, the risk is price volatility. A volatile investment may either make you…

Q: What is a “liquidity premium?” When do investors increase their attention to such a premium?

A: LIQUIDITY PREMIUM A liquidity premium is an additional value that the investors demand when the…

Q: 1.What is the relationship between an investment’s risk and its return? Please provide examples if…

A: Note:  As per our policy, we only answer one question, when more than one question is posted. The…