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 risk
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Which type of risk does not change when securities are added to a portfolio?
Unique risk
Company-specific risk
Systematic risk
Unsystematic risk
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- What type of risk is the risk that belongs to the market as a whole? Systematic risk Unsystematic risk (or nonsystematic risk) Total riskExplain the difference between (a) stand-alone risk and (b) risk in a portfolio context. How are they measured or calculated, and are they relevant to investors?Why does standalone risk differ from portfolio risk? Explain and give examples! Relates your answer with CAPM!
- 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 portfolioCompare and contrast systematic and unsystematic risk and how it affects a portfolio.: What is risk and how is it measured? How is risk measured in a portfolio compared to risk in a stand-alone stock? How do you measure the relevant risk in a portfolio?
- in broad terms, why are some risks diversifiable? Why are some risks non- diversifiable? Does it follow that an investor can control the level of unsystematic risk in a portfolio, but not the level of systematic risk? Substantiate your answer with real world examplesWhich of the following statements is true? Select one: Total risk = market risk + unique risk. Total risk = systematic risk + undiversifiable risk. Total risk = unique risk + diversifiable risk Market risk = undiversifiable risk + systematic risk. Total risk = diversifiable risk + firm-specific risk.Give specific examples of systematic and unsystematic risk. How many different securities must be owned to essentially diversify away unsystematic risk?
- What is Security selection: A) determining beta of securities. B) investing only in "safe" securities. C) choosing securities for portfolio. D) top-down analysis and bottom analysis.Please provide justificationHow do risk premiums influence financial decisions regarding risk and return?Define the terms, or give short explanations. -risk-free rate -risk management -risk neutrality risk preference -risk premium -risk-return trade-off
