Question
In: Economics
We can reduce financial asset risk by holding a. one blue chip stock b. gold c. health...
We can reduce financial asset risk by holding
|
a. one blue chip stock |
||
|
b. gold |
||
|
c. health care stocks |
||
|
d. a diversified portfolio |
Solutions
Expert Solution
Portfolio diversification is the risk management strategy of combining a variety of assets to reduce the overall risk of an investment portfolio.
The correct option is therefore
d. A diversified portfolio.
Rahul Sunny answered 2 years agoRelated Solutions
1. Suppose we have one risky asset Stock I and a risk-free asset. Stock I has...
1. Suppose we have one risky
asset Stock I and a risk-free asset. Stock I has an expected return
of 25% and a beta of 2. The risk-free asset’s return is
6%.
(15 marks total)
a. Calculate the
expected returns and betas on portfolios with x% invested in Stock
I and the rest invested in the risk-free asset, where x% = 0%, 25%,
75%, 100%, 125%, and 150%.
b. What
reward-to-risk ratio does Stock...
One of the financial risk is currency risk. How can we hedge the currency risk associated...
One of the financial risk is currency risk. How can we hedge the
currency risk
associated with the proposed trade? While you should show
familiarity with the
theoretical approach to such hedging, you should primarily focus
on practical
implementation of the strategy (what financial instruments and
why, where can we
access such instruments, what back office organizational systems
do we need for
financial instrument hedging, when should we hedge and why).
THIS IS IN REGARDS TO UBER.
Suppose the risk-free rate is 3%. Calculate the variance of a portfolio that has $3,000 in Stock B, $4,000 in Stock C, and $5,000 in the risk-free asset.
You have the following information:
Economy
State Probability
Stock
A Stock
B Stock
C
Good .4 14% 10% 22%
Neutral
.23 0% 1% 14%
Bad .37 -3% -9% -34%
Suppose the risk-free rate is 3%. Calculate the variance of a
portfolio that has $3,000 in Stock B, $4,000 in Stock C, and $5,000
in the risk-free asset.
0.012883
0.011243
0.011250
0.012941
None of the above.
In most cases, diversification can reduce or eliminate this type of risk. A. systematic risk. B....
In most cases, diversification can reduce or eliminate this type
of risk.
A. systematic risk.
B. nonsystematic.
C. macro risk
D. all risk.
For the middle-aged adult, exercise can reduce the risk of various health problems. Choose two at-risk...
For the middle-aged adult, exercise can reduce the risk of
various health problems. Choose two at-risk health issues that
regular physical exercise and activity can help prevent and manage.
Discuss the prevalence of each of these health problems in society
today. Describe measures that you would take as a nurse to assist
clients with health promotion measures to incorporate exercise and
physical activity into their lives. Include the kind of activities
you would recommend, the amount of exercise, and the...
For the middle-aged adult, exercise can reduce the risk of various health problems. Choose three health...
For the middle-aged adult, exercise can reduce the risk of
various health problems. Choose three health issues that regular
physical exercise and activity can help prevent and manage. Discuss
the prevalence of each of these health problems in society today.
Describe measures that you would take as a nurse to assist clients
with health promotion measures to incorporate exercise and physical
activity into their lives. Include the kind of activities you would
recommend, the amount of exercise, and the approach...
For the middle-aged adult, exercise can reduce the risk of various health problems. Choose three health...
For the middle-aged adult, exercise can reduce the risk of
various health problems. Choose three health issues that regular
physical exercise and activity can help prevent and manage. Discuss
the prevalence of each of these health problems in society today.
Describe measures that you would take as a nurse to assist clients
with health promotion measures to incorporate exercise and physical
activity into their lives. Include the kind of activities you would
recommend, the amount of exercise, and the approach...
For the middle-aged adult, exercise can reduce the risk of various health problems. Choose three health...
For the middle-aged adult, exercise can reduce the risk of
various health problems. Choose three health issues that regular
physical exercise and activity can help prevent and manage. Discuss
the prevalence of each of these health problems in society today.
Describe measures that you would take as a nurse to assist clients
with health promotion measures to incorporate exercise and physical
activity into their lives. Include the kind of activities you would
recommend, the amount of exercise, and the approach...
For the middle-aged adult, exercise can reduce the risk of various health problems. Choose three health...
For the middle-aged adult, exercise can reduce the risk of
various health problems. Choose three health issues that regular
physical exercise and activity can help prevent and manage. Discuss
the prevalence of each of these health problems in society today.
Describe measures that you would take as a nurse to assist clients
with health promotion measures to incorporate exercise and physical
activity into their lives. Include the kind of activities you would
recommend, the amount of exercise, and the approach...
Suppose we have two risky assets, Stock I and Stock J, and a risk-free asset. Stock...
Suppose we have two risky assets,
Stock I and Stock J, and a risk-free asset. Stock I has an expected
return of 25% and a beta of 1.5. Stock J has an expected return of
20% and a beta of 0.8. The risk-free asset’s return is 5%.
a. Calculate the expected returns and
betas on portfolios with x% invested in Stock I and the rest
invested in the risk-free asset, where x% = 0%, 50%, 100%, and
150%.
b. ...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Why is there no justice in the state of nature? What does this say about the...
- US History Was the federal government effective in the last 25 years of the 19th century?...
- for paper whitening process: 1. Outline the biochemical pathway that occurs in the industrial paper whitening...
- Water flows from a large 4m detention basin (100m by 50m) along a 200mm diameter pipe...
- What is the limiting factor in determining how many input/output ports a processor can access? A:...
- A taxpayer’s delivery van with an adjusted basis of $7,000 was stolen. Luckily, the taxpayer had...
- What are the outputs of the "Define activity phase" and the inputs to the "Sequence activity...
ADVERTISEMENT