Systematic risk, Risk Management

Systematic Risk

Systematic risk is any risk which affects the value of a huge number of assets; therefore, each asset will have a various degree of sensitivity to the underlying risk. In financial markets, if investors maintain large, well-diversified portfolios, then asset prices will be affected only by this kind of risk. Higher systematic risk will increase an investor's expected returns. Therefore, systematic risk cannot be diversified away.

Posted Date: 10/16/2012 7:07:43 AM | Location : United States







Related Discussions:- Systematic risk, Assignment Help, Ask Question on Systematic risk, Get Answer, Expert's Help, Systematic risk Discussions

Write discussion on Systematic risk
Your posts are moderated
Related Questions
Explain how you would hedge a short position in a European (plain vanilla) call with six  weeks to maturity if the spot price is 60, the strike is 65 and σ = 0.3, r=0.1. You rehedg

QUESTION 1 Discuss the following terms with supported examples (a) Country risks (b) Funding risks (c) Market risks QUESTION 2 Total return swaps are used by f

1. You are to analyze:  [1] internal financial options offered to employees as a benefit, [2] the external financial options that are offered by markets to outside investors who ma

Objectives of risk communication The fundamental goal of risk communication, as you may have realized, is to provide meaningful, relevant and accurate information, in  clear  a

Here is a basic risky decision problem: Using the template below, sketch the results of a sensitivity analysis on P(Deal Succeeds) for a risk-neutral decision maker. How hi

The project life cycle programme from the outline planning permission through subsequent scrutiny, design, tender, construction, commissioning and handover. It should justify and r

Determine actions to respond to outcomes of risk strategies How to improve your strategic RM Hubbard , D.W (2009) - Risk management can only be fixed by making the followi

discuss the post-loss objectives that would help firm recover

Evaluate the outcomes of risk management strategies The scope of strategic risk management evaluation The elements of a strategic risk management control system Issues

Question: (a) What is the objective of risk management? (b) Define the term risk avoidance. (c) Define and describe the Methodology of process approach in ISO 9000. (d