The average beta of Adam's portfolio is 1. Adam's friend has suggested he should disinvest from the securities above and instead invest in the market portfolio. Assuming that Adam takes his friend's recommendation, but later decides he would like to (1) take up a risk-averse position and reduce his average beta to less than 1, and (2) increase his risk level to an average beta greater than 1, what investment advice would you offer him

Answer rating: 100% (QA)

If Adam wants to reduce his average beta to less than 1 he should consider investing in assets with ... View the full answer