Question: Term Answer Description Risk A. Potential for variability in the possible outcomes associated with an investment. Expected rate of return B. The general term the
| Term | Answer | Description |
| Risk | A. Potential for variability in the possible outcomes associated with an investment. | |
| Expected rate of return | B. The general term the portion of an asset's total expected return that is greater than the return earned on the markets risk-free rate
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| Market Risk | D. The rate of return expected to be realized from an investment, calculated as the mean of the probability distribution of its possible returns
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| Coefficient of variation | E. This model determines the appropriate required return on a security as the sum of the market risk-free rate | |
| Stand-alone risk | F. The result of adding additional assets to a portfolio, when the returns of individual assets are noncorrelated | |
| Risk Premium | G A measure f the extent to which the returns on a given investment are correlated with returns of a market portfolio
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| Diversification | H. Term applied to the risk of asset that is measured by the standard deviation f the assets expected returns | |
| Capital Asset principle model | I the condition of price stability that results from the equality of a security expected and required returns.
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| Equilibruim | J. This statistical value provides a standardized measure of a security's risk per unit of return, and is useful in comparing the expected returns of different investments. | |
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