1. Compare the liquidity of an investment in raw land with that of an investment in common stock. Be specific as to why and how the liquidity differs. 2. Briefly discuss why international diversification reduces portfolio risk. Specifically, why would you expect low correlation in the rates of return for domestic and foreign securities? 3. Explain each of the following FOUR (4) considerations when investing surplus cash: Risk, Maturity, Liquidity, Return. 4. What are the advantages of investing in the common stock rather than the corporate bonds of a company? Compare the certainty of returns for a bond with those for a common stock.
1. Compare the liquidity of an investment in raw land with that of an investment in common stock. Be specific as to why and how the liquidity differs. 2. Briefly discuss why international diversification reduces portfolio risk. Specifically, why would you expect low correlation in the rates of return for domestic and foreign securities? 3. Explain each of the following FOUR (4) considerations when investing surplus cash: Risk, Maturity, Liquidity, Return. 4. What are the advantages of investing in the common stock rather than the corporate bonds of a company? Compare the certainty of returns for a bond with those for a common stock.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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1. Compare the liquidity of an investment in raw land with that of an investment in common stock. Be specific as to why and how the liquidity differs.
2. Briefly discuss why international diversification reduces portfolio risk. Specifically, why would
you expect low correlation in the
3. Explain each of the following FOUR (4) considerations when investing surplus cash:
Risk, Maturity, Liquidity, Return.
4. What are the advantages of investing in the common stock rather than the corporate
bonds of a company? Compare the certainty of returns for a bond with those for a common stock.
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