Consider two portfolios, one composed of 4 securities and the other of 10 securities All the securities have a beta of 1 and unique risk of 30 Each portfolio distributes weight equally among its component securities If the standard deviation of the market index is 20 , calculate the total risk of b...

The total risk of a portfolio can be expressed as Further the unique risk is the weighted avera ...

Consider two portfolios, one composed of 4 securities and the other of 10 securities. All the securities

Question:

Consider two portfolios, one composed of 4 securities and the other of 10 securities. All the securities have a beta of 1 and unique risk of 30%. Each distributes weight equally among its component securities. If the standard deviation of the market index is 20%, calculate the total risk of both portfolios. Portfolio
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds. A portfolio can also consist of non-publicly...