As the number of securities in portfolio increases

Assignment Help Financial Management
Reference no: EM131563427

As the number of securities in a portfolio increases:

a) Systematic risk decreases

b) Unsystematic risk does not change

c) The total risk approaches zero

d) Unsystematic risk decreases and approaches zero

Please elaborate on the correct answer

Reference no: EM131563427

Questions Cloud

The net present value method of investment appraisal : The net present value method of investment appraisal:
Spot price of japanese yen in british pound : If the spot price of Japanese Yen (JPY) in British pound (GBP) is greater than the price one-year forward is one-year interest rate higher in the United Kingdom
According to gordon dividend growth model : According to Gordon’s dividend growth model:
Compute the expected return on the portfolio : Compute the expected return on the portfolio. As their investment banker, what method would you recommend to the owners to raise capital?
As the number of securities in portfolio increases : As the number of securities in a portfolio increases:
Discount rate is used when calculating net present value : What discount rate is used when calculating net present value?
Decide to start saving for your retirement : You are 26 years old and decide to start saving for your retirement. How much will you have saved for? retirement?
Annual payment be if you sign up for this? mortgage : What will your annual payment be if you sign up for this? mortgage?
Makes the deposit on that birthday : How much money will be in the account on your 18th birthday immediately after your grandmother makes the deposit on that birthday?

Reviews

Write a Review

Financial Management Questions & Answers

  Portfolio expected return-variance and standard deviation

If your portfolio is invested 36 percent each in A and B and 28 percent in C, what is the portfolio’s expected return, the variance, and the standard deviation?

  Margin maintenance requirement

Assume the current spot price for crude oil is $66.65 per barrel and the futures price for crude oil is $66.70 per barrel. A futures contract is for 1000 barrels. On Monday, Stacey buys one futures contract from Ben. Both Stacey and Ben are speculato..

  Money to use for margin in trading futures

You have a $1000,000 of money to use for margin in trading futures. In this case what does margin mean?

  What is the leverage ratio

Suppose the repo rate is 4.15%, and the margin requirement (haircut) for a 3-day repo is 2% (i.e. collateral = 102% of money). You want to buy $100m of 10-year Treasuries and sell it 3 days later, using a repo to finance your purchase. How much of th..

  How does the compound annual return on your disney stock

What types of goals have been set by management to improve efficiency in operations, and have those goals been met?

  What is the fair price of the stock

MicroSense, Inc., paid $2 dividends per share last year. It is estimated that the company’s ROEs will be 12% and 10%, respectively, next two years. The plowback rate in next two years will be 0.6. It is expected that the dividends will grow at a sust..

  Concerning relevant costs and relevant revenues

Which of the following is false concerning relevant costs and relevant revenues? The variation in total costs between two alternatives is known as. Reinstein decided to complete a fifth year of college instead of accepting a job with a public account..

  Maximum total cost recovery deduction

Tessa owns an unincorporated manufacturing business. In 2015, she purchases and places in service $207,000 of qualifying five-year equipment for use in her business. Her taxable income from the business before any Sec. 179 deduction is $15,000. Tessa..

  What are capital structure weights on book value basis

Vedder, Inc., has 7.2 million shares of common stock outstanding. The current share price is $62.20, and the book value per share is $5.20. Vedder also has two bond issues outstanding. The first bond issue has a face value of $71.2 million, a coupon ..

  Annual interest compounded quarterly to accomplish his goal

Stan wants to have $150,000 available in four years. What size quarterly deposits does Stan have to make into an account that pays 5.6% annual interest compounded quarterly to accomplish his goal? Assume the first deposit is made in one quarter.

  Calculate the total cost of the seasoned equity offering

Calculate the total cost of the seasoned equity offering to RPC's existing stockholders as a percentage of the offering proceeds.

  Find the accumulated value of this annuity

Serena receives a fifty-year annuity due that has payments that start at $2,000 and increase by 3% per year through the twenty-fourth payment, then stay level at $4,000. Find the accumulated value of this annuity at the end of fifty years if the annu..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd