True regarding risk and return

Assignment Help Financial Management

Reference no: EM131456260

Which of the following is NOT true regarding risk and return?

a) Unsystematic risk of a portfolio can be diversifed away by increasing the number of assets in the portfolio

b) Unsystematic risk of an asset is related to firm-specific events

c) An asset's total risk (stand-alone risk) is measured as standard deviation of its returns.

d) investors must be compensated for bearing the total risk of an asset

e) systematic risk is related to industry and/or general market conditions

Reference no: EM131456260

Questions Cloud

How much would the bonds price change : how much would the bond’s price change?

Weighted average cost of capital-unlevered cost of capital : What are the differences between WACC (weighted average cost of capital) and unlevered cost of capital?

Probability distributions and returns of two stocks : You have estimated the following probability distributions and returns of two stocks:

Construct estimates of forward rates for year four contract : purposes of negotiations with the banker, construct estimates of forward rates for year four contract. Assume annual compounding.

True regarding risk and return : Which of the following is NOT true regarding risk and return?

What are average return-standard deviation of your portfolio : You hold an equally-weighted portfolio consisting of two stocks X and Y, What are average return and standard deviation of your portfolio xy

Annual coupon bond with a face value : Consider an eight-year, 13 percent annual coupon bond with a face value of $1,000. The bond is trading at a rate of 10 percent.

Discuss about the capital budgeting techniques with examples : What is capital budgeting? Briefly discuss about the capital budgeting techniques with examples.

Bond value does repayment of principal represent : Barry’s Steroids Company has $1,000 par value bonds outstanding at 13 percent interest. what percent of total bond value does repayment of principal represent.

User Account

All Pages