A "risk-premium" is the difference between ___________________________ . A) the variance of a stock's returns compared to variance of the market's returns B) systematic and unsystematic risks C) market and firm-specific risks D) an asset's expected return and the risk-free rate
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- Beta is which of the following: A) standard deviation. B) total risk. C) Beta is the relationship which is between an investment's return, and the market return. D) unsystematic risk.The risk associated with the overall market is referred to as _____ risk. a. unsystematic b. diversified c. portfolio d. systematicA plot/graph of the positive relation between systematic risk and expected return is called: O security market line standard deviation and width of the normal distribution O covariance graph O capital asset pricing model
- What type of risk is the risk that belongs to the market as a whole? Systematic risk Unsystematic risk (or nonsystematic risk) Total riskwhy can variance/volatility of returns be a misleading measure of risk for an individual asset held as part of a portfoliob) Give a graphical example to present the positioning of. E Systematic risk E Risk free rate of returm E Market rate of return, and E Risk premium.
- Standard deviation of portfolio returns is a measure of ___________. Group of answer choices total risk systematic risk market risk firm-specific risk unsystematic riskThe risk of a portfolio is the variance of its return. However, the variance of the returns of an individual asset is not an appropriate measure of its risk. Discussa)define market risk. b)define delta-hedged position and describe delta hedging. c)describe gamma hedging and vega hedging. d)define and explain value at risk (VAR). e)describe the analytical (variance-covariance) method of calculating VAR, and discuss its advantages and disadvantages.
- How does standard deviation and variance affect portfolio risk, more so than expected return?Beta is defined as the: a. Amount of systematic risk in a risky asset relative to that in an average asset. b. Ratio of unsystematic risk in a risky asset relative to the systematic risk in the overall market. c. Amount of systematic risk in a risky asset relative to that of a risk-free asset. d. Ratio of the total risk in a risky asset relative to the systematic risk in the overall market. e. Slope of the security market line.Which of the following statements is true? Select one: Total risk = market risk + unique risk. Total risk = systematic risk + undiversifiable risk. Total risk = unique risk + diversifiable risk Market risk = undiversifiable risk + systematic risk. Total risk = diversifiable risk + firm-specific risk.