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Investment risk that can be reduced or eliminated by combining several diverse investments in a portfolio. Non-market (non-systemic) risks are diversifiable risks.
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In business what is the relationship between risk and profit?
The relationship between the two is that risk is needed to make a profit. A profit is money left over after expenses have been paid. To have expenses you need to take risks.
What is the relationship between financial decision making and risk and return?
plz quote me the answer of the above question
What is the difference between registered company and partnership?
Unlike the shareholders in a limited company, the members of a general partnership have no financial protection if the business runs into trouble - each partner is responsible for the debts of the partnership as a whole. This means that each partner's personal assets may be at risk if the business fails
What are the three components of Audit risk?
Inherent Risk, Control Risk and Detection Risk
Which are the five audit implications of business risk?
Client viabilty Inherent risk: Tone at the top Audit risk of specific assertions Analyticals Information systems
What is another term for market risk?
another term for market risk is non-diversifiable risk.
What is the difference between has the risk or takes the risk?
one has the word has in and one has the word takes in Diversifiable risk is the risk which can be mitigated by investing in different companies, different sectors, different assets and also different regions. Here we trying to minimize the risk of huge loss by taking the whole risk against one or few companies/ sectors / assets / regions. Non-Diversifiable risk can not be mitigated at all. This is the risk you are exposed to in individual investment. Every investment holds Market risk, i.e. uncertainity of market moving up or down and respective movement of your investment .
Does beta measure nondiversifiable risk?
Yes, beta measures the sensitivity of an asset's returns to market movements, representing the nondiversifiable risk (systematic risk) of an investment. A beta of 1 indicates that the asset moves in line with the market, while a beta greater than 1 implies higher volatility, and a beta less than 1 indicates less volatility than the market.
Strikes lawsuits regulatory actions and increased competition are all examples of?
diversifiable risk
What is Difference between wholesaler and retailer on the basis risk?
what is Difference between wholesaler and retailer on the basis risk?
What is difference between constraint an risk?
A constraint is a limitation that is visible and present. The difference between a constraint and risk is that a risk is problem that is not yet seen, or a potential problem.
What are the difference between political risk and country risk?
they are the same
What is the difference between transaction risk and economic risk?
Transaction is bank risk
How many diverse securities are required to eliminate the majority of the diversifiable risk from a portfolio?
recent research has found it would be 50 to 60 stocks .
What is the difference between SML and CML?
Differences between CML and SML· Capital market line measures risk by standard deviation, or total risk· Security market line measures risk by beta to find the security's risk contribution to portfolio M· CML graphs only defines efficient portfolios· SML graphs efficient and nonefficient portfolios· CML eliminates diversifiable risk for portfolios· SML includes all portfolios that lie on or below the CML, but only as a part of M, and the relevant risk is the security's contribution to M's risk· Firm specific risk is irrelevant to each, but for different reasons
What is the difference in risk assumed between participating and non-participating policies?
What risk? Assumed by who?
What is the difference between mitigation and remediation?
Reduce the impact of risk is MitigationRemoval of risk is Remediation
