Risk and Return

I.DEFINITIONS PORTFOLIOS 1.A portfolio is: a.a group of assets, such as stocks and bonds, held as a collective unit by an investor. b.the expect give birth on a dubious asset. c.the expected return on a collection of risky assets. d.the variance of returns for a risky asset. e.the standard deviation of returns for a collection of risky assets. PORTFOLIO WEIGHTS 2.The persona of a portfolios total value invested in a particular asset is c all(prenominal)(a)ed that assets: a.portfolio return. b.portfolio weight. c.portfolio risk. d.rate of return. e. enthronization value. SYSTEMATIC RISK 3. jeopardy that affects a large number of assets, individually to a greater or lesser degree, is called _____ risk. a.idiosyncratic b.diversifiable c. opinionated d.asset-specific e.total UNSYSTEMATIC RISK 4.Risk that affects at most a small number of assets is called _____ risk. a.portfolio b.undiversifiable c.market d.unsystematic e.total belief OF DIVERSIFICATION 5.The principle of diversification tells us that: a.concentrating an enthronisation in two or three large stocks entrust eliminate all of your risk. b.

concentrating an investment in three companies all within the identical industry will greatly reduce your overall risk. c. dissemination an investment across five diverse companies will non lower your overall risk at all. d.spreading an investment across many diverse assets will eliminate all of the risk. e.spreading an investment across many diverse assets will eliminate some of the risk. SYSTEMATIC RISK PRINCIPLE 6.The _____ tells us that the expected return on a risky asset depends scarcely on that assets nondiversifiable risk. a.Efficient Markets Hypothesis (EMH) b.systematic risk principle c.Open Markets Theorem d.Law of One Price e.principle of diversification beta COEFFICIENT 7.The amount... If you want to get a full essay, order it on our website: Orderessay

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