What assumption about risk-adjusted techniques for measuring performance poses a potential problem? A. Portfolio risk is constant overtime B. Returns are normally distributed  C. Mean reversion D. None of the options are correct E. Lognormal outcome of prices

Hedging a portfolio   a. Will generate above average returns when options expire   b. none of the answers given      c. Will generate below average returns when options expire without being used   d. Will generate riskless payoffs when options expire

Unsystematic risk: is compensated for by the risk premium. is measured by standard deviation. is related to the overall economy. can be effectively eliminated by portfolio diversification. is measured by beta.

The Monte Carlo approach is known for: Group of answer choices C. Histogram of portfolio values. No answer text provided. A. Being nonparametric (No need to worry about setting parameters). B. Repeated simulations.

2. Stock prices and stand-alone risk Risk is the potential for an investment to generate more than one return. A security that will produce only one known return is referred to as a risk-free asset, as there is no potential for deviation from the known expected outcome. Investments that have the chance of producing more than one possible outcome are called risky assets. Risk, or potential variability in an investment's possible returns, occurs when there is uncertainty about an investment's future outcome, such as the return expected to be generated by the investment and realized by an investor. Generally, investors would prefer to invest in assets that have: O A higher-than-average expected rate of return given the perceived risk O A lower-than-average expected rate of return given the perceived risk Read the following descriptions and identify the type of risk or term being described: Description This type of risk relates to the possibility that a firm will not be able to service its…

Portfolio provides average risk but much lower return. The key is the negative correlations among individual stocks. True False   Answer should be correct(Be fast)

If markets are efficient, periodic (e.g. daily) portfolio returns should have zero serial correlation.  True  False

Changing the market risk premium A. Changes neither the y-intercept nor the slope of the security market line B. Changes only the y-intercept of the security market line C. Changes only the slope of the security market line D. Changes both the y-intercept and the slope of the security market line

Theta measures an option's: Multiple Choice O O intrinsic value. volatility. rate of time decay. sensitivity to changes in the value of the underlying asset. sensitivity to changes in the risk-free rate.

Please do not give solution in image format   Thankyou