Systematic risk will Blank______. Multiple choice question. decrease when securities are added to a portfolio be eliminated when securities are added to a portfolio not change when securities are added to a portfolio increase when securities are added to a portfolio
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Systematic risk will Blank______.
decrease when securities are added to a portfolio
be eliminated when securities are added to a portfolio
not change when securities are added to a portfolio
increase when securities are added to a portfolio
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- Which type of risk does not change when securities are added to a portfolio? Multiple choice question. Unique risk Company-specific risk Systematic risk Unsystematic riskWhich of the following risks are reduced as more securities are added to the underlying portfolio? More than one answer may be correct. Multiple select question. Asset-specific risk Systematic risk Unique risk Market risk Unsystematic riskhe benefit in risk reduction from adding securities Blank______ as more and more securities are added to a portfolio. Multiple choice question. remains the same increases declines
- The benefit in risk reduction from adding securities Blank______ as more and more securities are added to a portfolio. Multiple choice question. increases declines remains the sameThe risk associated with the overall market is referred to as _____ risk. a. unsystematic b. diversified c. portfolio d. systematicWhen a portfolio is diversified, what type of risk is reduced? Multiple Choice unsystematic risk systematic risk
- can be progressively eliminated by adding stocks to a portfolio? Systematic risk Specific risk Market risk Inflation rate riskich of the following will not reduce risk in a portfolio? Select one: a. Selecting two securities that are perfectly positively correlated. b. Selecting two securities that are positively correlated. c. Selecting two securities that are perfectly negatively correlated. d. Selecting two securities that are negatively correlated.Which of the following statements is FALSE? i. The amount of a portfolio's risk that is diversified away depends on risk of assets that you add it to ii. The amount of a portfolio's risk that is diversified away depends on market risk premium iii. The amount of a portfolio's risk that is diversified away depends on risk-free rate of interest iv. The amount of a portfolio's risk that is diversified away depends on weights of the assets that you add it to O i and ii O ii and iii iii and iv O i and iv O ii, iii and iv
- Economy Probability Stock A Stock B Recession -30% -20% 10% 5% 40% 15% Average Boom What is the standard deviation of Stock A? 18.8% 24.9% 12.9% 0.25 0.50 0.25 20.0%The risk fora portfolio is decreased when the particular stocks tend to move up and down together. True or False True FalsePortfolios on the Capital Market Line (CML) have different levels of ____? Idiosyncratic risk Total risk Sharpe Ratio Risk-free rate None of the above
