Question

Systematic Risk is A. eliminated totally if there are over a 30 stocks in your portfolio B. the same as unique risk C. the risk from exposure to the market, marcoeconomic factors etc D. the risk arising from the interconnectedness of banks leading to the recession in 2008

Answer 1

C. the risk from exposure to the market, marcoeconomic factors etc

Systematic risks are those which affects the whole economy. It affects the entire stocks in an economy. Examples of systematic risks are macroeconomic factors such as increase in inflation rates, chnages in interest rates, pandemics like COVID etc. These risks cannot be eliminated.

Answer 2

The answer is: the risk from exposure to the market, macroeconomic factors etc

This risk arises when the market is volatile or bearish which is generally caused due to economic factors and cannot be eliminated through diversification.