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3 years ago

Diversification is important in investing because...

2 answers:

8 0

Diversification is important in investing because "It helps you to balance your risk across different types of investments".

Explanation:

Diversification is a risk management approach that includes investing beyond or within various asset types to depreciate the ups and downs of economic exchanges. In different terms, diversification is thereby not owning all your eggs in one basket. Diversification goes by expanding properties beyond and within various asset types. Because asset types have their own individual financial rounds, when one class is making substantial profits, another may not be functioning as well. By expanding your purchases beyond and within distinct asset categories you’ll be in an immeasurable situation to offset the buoyancy of unique expenses.

san4es73 [151]3 years ago

6 0

<u>Diversification is important in investing because the risk associated with the investment is lower. </u>

Further Explanation:

Diversification is the strategy of investing in the market at a lower risk. In this strategy, the company, individual and corporation invest their savings in a different industry. So, the risk for the overall investment becomes lower. If the investor puts all of his savings in one industry and if that industry goes into depression, the whole saving of the investor has become futile. But the investor invests some of his money in two different industries and maybe one goes in depression then the loss occurred can be compensated by the profit from the other industry.

Types of diversification:

Industry diversification: In this type of diversification, the investor invests in the different industries of the market.
Assets diversification: In this type of diversification, the investor invests in different instruments and assets of the company. For example, treasury bills, and mutual funds.
Geographic diversification: In this type of diversification, the investor invests in a different location. For example, home country investment and foreign country investment.
Individual company diversification: In this type of diversification, the investor invests in a different company at his particular needs.

Learn more:

1. Learn more about diversification

<u>brainly.com/question/2480636 </u>

2. Learn more about investment

<u>brainly.com/question/5959656 </u>

3. Learn more about risk-free rate

<u>brainly.com/question/7268541 </u>

Answer details:

Grade: Middle School

Subject: International business

Chapter: Diversification

Keywords: diversification, investing, because, the risk associated, lower risk, strategy, individual, compensate by profit, industry, assets, geographic.

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The common stock of Zeta Group sells for $42 per share, has a rate of return of 12.2 percent, and a dividend growth rate of 1.8

Soloha48 [4]

Answer:

The amount of the last annual dividend paid is <u>$4.3</u>.

Explanation:

Given:

The common stock of Zeta Group sells for $42 per share, has a rate of return of 12.2 percent, and a dividend growth rate of 1.8 percent annually.

Now, to find the amount of last annual dividend paid.

Let the amount of last annual dividend paid be $l.$

Price of per share ( $p$ ) = $\$42.$

Rate of return ( $r$ ) = $12.2\%.$

Rate of dividend growth ( $g$ ) = $1.8\%.$

Now, to get the amount of last dividend paid we put formula:

$p=\frac{l(1+g)}{r-g}$

$42=\frac{l(1+1.8\%)}{12.2\%-1.8\%}$

$42=\frac{l(1+0.018)}{0.122-0.018}$

$42=\frac{l\times 1.018}{0.104}$

<em>Multiplying both sides by 0.104 we get:</em>

<em>Dividing both sides by 1.018 we get:</em>

$4.3=l$

$l=\$4.3.$

Therefore, the amount of the last annual dividend paid is $4.3.

6 0

3 years ago

True or false: the term economic investment includes purchasing stocks, bonds, and real estate.

Lapatulllka [165]

False because it doesnt invest the stocks

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3 years ago

Jamie’s Bakery, a small chain of eight bakeries in Altamonte Springs, Florida has recorded sales growth of 30 percent or more pe

pantera1 [17]

<h3>Answer:</h3>

Gazelle

<h3>Explanation:</h3>

Jamie's Bakery has recorded a growth of 30% and above from 2010 to 2017 with revenues of $229,000.
This makes Jamie's bakery a gazelle company or business due to the growth of 30% in sales per year for a period of more than four years since it was started in 2010.
Gazelle ventures or business are fast growing and expands at a high rate and thus important to an economy.

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3 years ago

A critical analysis of a preferred alternative to ascertain its strengths and weaknesses before it is implemented, with the purp

Aleonysh [2.5K]

Answer:

Devil’s advocacy

Explanation:

Devil’s advocacy is a thorough analysis of a preferred alternative to check and test its strengths and weaknesses before being implemented with the purpose of identifying all the faults that might make the preferred alternative unacceptable.

This method helps in determining the dangers of any action taken by an individual or group of persons.

8 0

3 years ago

Read 2 more answers

An investment, which is worth 26,800 dollars and has an expected return of 4.28 percent, is expected to pay fixed annual cash fl

Dennis_Churaev [7]

Answer:

Present Value = $22,663.69

Explanation:

<em>The present value of a sum expected in the future is the worth today given an opportunity cost interest rate. In another words ,it is amount receivable today that would make the investor to be indifferent between the amount receivable today and the future sum.</em>

The present value of a lump sum can be worked out as follows:

PV = FV × (1+r)^(-n)

PV - Present value - ?

FV - Future value - 26,800

r- Interest rate per period - 4.28%

n- number of periods- 4

PV = 26,800 × (1.0428)^(-4)=22,663.69

PV = $22,663.69

7 0

3 years ago