13. Which of the following is true about not distributed returns? a. The return

Question

13. Which of the following is true about not distributed returns? a. The return distribution can b, 20 two numbers. be summarized with Over 90% of realized returns are within one standard deviation of the mean he plot of realized returns over time looks like the bell curve. There is a 50% chance realized returns are positive. d. 14. W hich of the following assets has the highest amount of systematic risk? a. The market portfolio b. The risk-free asset An individual stock with beta = 1.5 and standard deviation = 14% An individual stock with beta standard deviation d. 0.5 and 15% 15. Which of the following statements is true about portfolio weights? a. Each weight must be between zero and one b. Portfolio weights change over time even without trading c. Portfolio weights must be positive. d. Assets with higher prices have higher portfolio weights 16. If a stock portfolio is well diversified, then the portfolio variance: a. Will equal the variance of the most volatile stock in the portfolio. b. May be less than the variance of the least risky stock in the portfolio. c. Must be equal to or greater than the variance of the least risky stock in the portfolio. d. Will be a weighted average of the variances of the individual securities in the portfolio 17. Which of the following indicates that a portfolio is being effectively diversified? a. Portfolio beta decreases b. Portfolio standard deviation decreases c. Portfolio expected return increases d. Number of assets increases.

Explanation / Answer

15. Portfolio weights must be between zero and one.

17. A portfolio is being effectively diversified when portfolio standard deviation decreases. Basically the risk is reduced if the portfolio is diversified.

Please post other questions separately. Thanks.

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.