hi, could you please simply answer these as true or false 1) Asset allocation is the...

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hi, could you please simply answer these as true or false

1) Asset allocation is the process of diversifying a portfolio of common stocks. 2) Market risk can be diversified away. 3) B

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Answer 1

Answer #1

1) False (Asset allocation involves coming up with an investment strategy as per an investor's risk tolerance, goals and investment horizon)

2) False (Market risk, also knows as systematic risk, can not be diversified away. Unsystematic risk can be diversified away)

3) True

4) True

5) False (Change in bond prices and interest rates are inversely related to each other)

6) True

7) False (As interest rates decrease, bond prices increase meaning bonds sell at a premium)

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Answer 2

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