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4vir4ik [10]
3 years ago
9

True or False: Increasing the number of stocks in a portfolio reduces market risk.Consider two stock portfolios. Portfolio B con

sists of 20 different stocks from firms in different industries. Portfolio A consists of 10 different stocks, also from firms in different industries. The return on Portfolio B is likely to be volatile than that of Portfolio A.
Business
1 answer:
nikitadnepr [17]3 years ago
7 0

Answer:

The correct answer is False.

Explanation:

A basic principle of investments is the creation of portfolios (or portfolios) for diversification purposes. At any given time, investors simultaneously hold a set of assets that make up their investment portfolio. A basic principle in finance is that an investor should not place all of his resources in a single asset or in a relatively small number of assets, but in a large number of investment instruments. In this way, the possible bad results in certain assets would be offset by the good results of others. Diversification allows the investor to lower the risk of his portfolio without sacrificing returns or, alternatively, increase the return on his portfolio without increasing his risk. Of course, diversification does not guarantee profits under any circumstances, but it does help to dampen the variability of returns on individual assets.

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Suppose that you just paid $76,000 for a security that will make its first payment to you in 7 years from today. It will continu
iogann1982 [59]

Answer:

$5,346.98

Explanation:

Initial cash flow = 76,000

Discount rate = 5%

Suppose the C.F. in the 7th year is x which will flow till perpetuity

Present value of annual cash flow till perpetuity = Annual cash flow / Discount rate

PV at the 7th year = x/0.05

Discount factor = (1 + r)^n

Discount rate = 5%

Years   D. factor   Cash flows

0                 0            76,000

1           0.952381            -

2          0.907029           -

3          0.863838           -

4          0.822702           -

5          0.783526           -

6          0.746215            -

7           0.710681          x/0.05

So, 76000 = 0.710681 *(x/0.05)

76000 / 0.710681  = x / 0.05

x = 76000 / 0.710681 * 0.05

x = 5346.98408990813

x = 5346.98

Hence, if the interest rate is 5%, $5346.98 will be received annually from the 7th year

7 0
3 years ago
Why is developing a reputation as a subject matter expert important for a leader if leadership deals so heavily with interperson
Lilit [14]

Answer:

Reputation is very important for a leader. If a leader has god interpersonal skills but lacks in good reputation people might hesitate to associate with him and support his activities.

Explanation:

Reputation is most valuable asset for any leader. A leader may have good knowledge of everything, he may have good interpersonal skills but reputation overcomes all of these qualities. Strong reputation of a leader will make it easy for him to earn popularity and respect among people. Reputation is the main quality which leads to success to a leader.

5 0
3 years ago
Which of the following is a true statement? leaving all property to the surviving spouse maximizes the marital deduction and the
vovangra [49]

In the analysis of the given options, the most likely answer to this question is a bypass provision in the will of the deceased spouse is designed to use the unified credit of the deceased spouse by transferring property to beneficiaries other than the surviving spouse.Thank you for your question. Please don't hesitate to ask in Brainly your queries. 
4 0
3 years ago
Read 2 more answers
Which of the following is a non-depository intermediary?
Rina8888 [55]

Answer:

d

Explanation:

i did it

8 0
3 years ago
What is the approach that Scrum encourages when a Team determines it will be difficult to deliver any value by the end of a Spri
garik1379 [7]

Answer:

A.  Together with the Product Owner, focus on what can be done and identify a way to deliver something valuable at the end of each Sprint

Explanation:

The approach that is to be applied for delivering the value that becomes difficult is to come together by involving the owner of the product so that we get to know by focusing it and identify the way for delivering the valuable things so that in return the customer could satisfy with the product and the chances of building a long term relation would became high

6 0
3 years ago
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