Homework Answers
please find below the solution.. let me know if you need any clarification..
correct answer is option : once a portfolio contains about 4 or 5 stocks, adding additional stocks will do little to reduce risk.
Because, market risk cant not be eliminated . Adding the additional stock can reduce little the diversifiable risk .
Add Answer to:
Question 13 1 pts Which of the following statements is CORRECT? Once a portfolio contains about...
Question 1 1 pts Select the statement below that is correct: After a portfolio has about...
Question 1 1 pts Select the statement below that is correct: After a portfolio has about 20 stocks, adding additional stocks will not reduce its risk at all. The higher the correlation between the stocks in a portfolio, the lower risk inherent in the portfolio. An investor can eliminate almost all diversifiable risk if they hold a large well-diversified portfolio of stocks. An investor can eliminate almost all non-diversifiable risk if they hold a large well-diversified portfolio of stocks. An...
QUESTION 18 Which of the following statements is CORRECT? 1. An investor can eliminate virtually all...
QUESTION 18
Which of the following statements is CORRECT?
1.
An investor can eliminate virtually all diversifiable risk if
he or she holds a very large, well-diversified portfolio of
stocks.
2.
Once a portfolio has about 40 stocks, adding additional stocks
will not reduce its risk by even a small amount.
3.
It is impossible to have a situation where the market risk of
a single stock is less than that of a portfolio that includes the
stock.
4.
An...
Please answer Which of the following statements about portfolio diversifications are correct? Check all that apply....
Please answer
Which of the following statements about portfolio diversifications are correct? Check all that apply. The higher the stocks' correlation coefficients,the lower the portfolio's risk. Stocks with perfectly negatively correlated returns do not exist. By adding enough partially correlated stocks, risk can be completely eliminated The risk of a portfolio declines as the number of stocks in the portfolio increases.
PLEASE EXPLAIN WHY ANSWER IS TRUE OR FALSE: "Risk aversion" implies that investors require higher expected...
PLEASE EXPLAIN WHY ANSWER IS TRUE OR FALSE: "Risk aversion" implies that investors require higher expected returns on riskier than on less risky securities. a. True b. False When adding a randomly chosen new stock to an existing portfolio, the higher (or more positive) the degree of correlation between the new stock and stocks already in the portfolio, the less the additional stock will reduce the portfolio's risk. a. True b. False An individual stock's diversifiable risk, which is measured...
98) Which of the following statements is FALSE A) The volatility declines as the number of stocks in a portfolio grows. B) An equally weighted portfolio is a porfolio in which the same amount is...
98) Which of the following statements is FALSE A) The volatility declines as the number of stocks in a portfolio grows. B) An equally weighted portfolio is a porfolio in which the same amount is invested in eadh stock C) As the number of stocks in a portfolio grows large, the variance of the portfolio is determined primarily by the average covariance among the stocks D) When combining stocks into a portfolio that puts positive weight on each stock, unless...
Using historical data to measure portfolio risk and correlation coefficient Carlos is an investor who believes...
Using historical data to measure portfolio risk and correlation coefficient Carlos is an investor who believes that past variability of stocks isa reasonably good estimate of future risk associated with the stocks. Carlos works on creating a new portfolio and has already purchased stock A. Now he considers tv.'o ether stocks, B and C. Carlos collected data on the historic rates of return for all three stocks, which are presented in the following table. Complete the table by calculating standard...
Your answer: Question 11 (CHAPTER 13) Which ONE of the following statements is true? (a) The...
Your answer: Question 11 (CHAPTER 13) Which ONE of the following statements is true? (a) The unexpected annual return may be positive or negative, however over time it will be zero, on average. (b) Portfolio means buying 2 or more shares of stock from some company. (c) In a well diversified portfolio of stocks, its variance of returns can never be less than the variance of returns for its least risky stock. (d) As you invest your money into stocks...
7. Using historical data to measure portfolio risk and correlation coefficient Peter is an investor who...
7. Using historical data to measure portfolio risk and correlation coefficient Peter is an investor who believes that past variability of stocks is a reasonably good estimate of future risk associated with the stocks. Peter works on creating a new portfolio and has already purchased stock A. Now he considers two other stocks, B and C. Peter collected data on the historic rates of return for all three stocks, which are presented in the following table. Complete the table by...
I ONLY CAN SHOW ONE OPTIONS OF THEM 7. Using historical data to measure portfolio risk...
I ONLY CAN SHOW ONE OPTIONS OF THEM
7. Using historical data to measure portfolio risk and correlation coefficient Aa Aa Pam is an investor who believes that past variability of stocks is a reasonably good estimate of future risk associated with the stocks. Pam works on creating a new portfolio and has already purchased stock A. Now she considers two other stocks, B and C. Pam collected data on the historic rates of return for all three stocks, which...
Question 10 9 points) Consider the following plot of an investment opportunity set for all stocks...
Question 10 9 points) Consider the following plot of an investment opportunity set for all stocks in the market. Assume the CAPM holds for all parts below Elrl Standard Deviation (1) Draw the capital market line (CML) and label the market portfolio on this plot. (3pts) (2) Suppose investor A has a very high risk aversion and investor B has a very low risk aversion. Label investor A's complete combined portfolio as Ca and investor B's complete combined portfolio as...
Question 1 1 pts Select the statement below that is correct: After a portfolio has about 20 stocks, adding additional stocks will not reduce its risk at all. The higher the correlation between the stocks in a portfolio, the lower risk inherent in the portfolio. An investor can eliminate almost all diversifiable risk if they hold a large well-diversified portfolio of stocks. An investor can eliminate almost all non-diversifiable risk if they hold a large well-diversified portfolio of stocks. An...
QUESTION 18
Which of the following statements is CORRECT?
1.
An investor can eliminate virtually all diversifiable risk if
he or she holds a very large, well-diversified portfolio of
stocks.
2.
Once a portfolio has about 40 stocks, adding additional stocks
will not reduce its risk by even a small amount.
3.
It is impossible to have a situation where the market risk of
a single stock is less than that of a portfolio that includes the
stock.
4.
An...
Please answer
Which of the following statements about portfolio diversifications are correct? Check all that apply. The higher the stocks' correlation coefficients,the lower the portfolio's risk. Stocks with perfectly negatively correlated returns do not exist. By adding enough partially correlated stocks, risk can be completely eliminated The risk of a portfolio declines as the number of stocks in the portfolio increases.
98) Which of the following statements is FALSE A) The volatility declines as the number of stocks in a portfolio grows. B) An equally weighted portfolio is a porfolio in which the same amount is invested in eadh stock C) As the number of stocks in a portfolio grows large, the variance of the portfolio is determined primarily by the average covariance among the stocks D) When combining stocks into a portfolio that puts positive weight on each stock, unless...
Using historical data to measure portfolio risk and correlation coefficient Carlos is an investor who believes that past variability of stocks isa reasonably good estimate of future risk associated with the stocks. Carlos works on creating a new portfolio and has already purchased stock A. Now he considers tv.'o ether stocks, B and C. Carlos collected data on the historic rates of return for all three stocks, which are presented in the following table. Complete the table by calculating standard...
Your answer: Question 11 (CHAPTER 13) Which ONE of the following statements is true? (a) The unexpected annual return may be positive or negative, however over time it will be zero, on average. (b) Portfolio means buying 2 or more shares of stock from some company. (c) In a well diversified portfolio of stocks, its variance of returns can never be less than the variance of returns for its least risky stock. (d) As you invest your money into stocks...
I ONLY CAN SHOW ONE OPTIONS OF THEM
7. Using historical data to measure portfolio risk and correlation coefficient Aa Aa Pam is an investor who believes that past variability of stocks is a reasonably good estimate of future risk associated with the stocks. Pam works on creating a new portfolio and has already purchased stock A. Now she considers two other stocks, B and C. Pam collected data on the historic rates of return for all three stocks, which...
Question 10 9 points) Consider the following plot of an investment opportunity set for all stocks in the market. Assume the CAPM holds for all parts below Elrl Standard Deviation (1) Draw the capital market line (CML) and label the market portfolio on this plot. (3pts) (2) Suppose investor A has a very high risk aversion and investor B has a very low risk aversion. Label investor A's complete combined portfolio as Ca and investor B's complete combined portfolio as...
Most questions answered within 3 hours.
-
answer the questions throughout this program
public class Day implements Comparable {
Private Boolean atWork;...
asked 43 seconds ago -
This is C++ code for parking fee management program
#include <iostream>
#include <iomanip>
using namespace std;...
asked 11 minutes ago -
The free energy change for the following reaction at 25 °C, when
[Sn2+] = 1.17 M...
asked 1 hour ago -
An MNE is this kind of industry when competition in one country
is essentially independent of...
asked 3 hours ago -
. For this set of questions, determine what
proportion of a normal distribution is located betweeneach...
asked 4 hours ago -
A college student is employed as a door-to-door newspaper
salesman. Historical data suggests that the student...
asked 4 hours ago -
MATLAB HW 11 problem using Switch Case and Input commands
Write a script file that calculates...
asked 4 hours ago -
Considering gravitational time dilation, calculate the time that
passes in Earth’s surface while 1 hour passes...
asked 5 hours ago -
Minitab Problem: Take the Lake Hume June rainfall data and find
use the processes outlined in...
asked 6 hours ago -
X Company is trying to decide whether to continue using old
equipment to make Product A...
asked 6 hours ago -
IN PYTHON ONLY !! Program 2: Re-work
program #5 (WeeklyHours) from the previous assignment such that...
asked 6 hours ago -
The average length of time between arrivals at a turnpike
toll-booth is 26 seconds. What is...
asked 8 hours ago