The capital asset pricing model (CAPM) explains how risk should be considered when stocks and other assets are held The CAPM states that any stock's required rate of return is the risk-free rate of return plus a risk premium that reflects only the risk remaining -Select- V diversification. Most individuals hold stocks in portfolios. The risk of a stock held in a portfolio is typically ] the stock's risk when it is held alone. Therefore, the risk and return of an individual stock should be analyzed in terms of how the security affects the risk and return of the portfolio in which it is held. is generally because diversification the portfolio's risk. Quantitative Problem: You are holding a portfolio with the following investments and betas: The capital asset pricing model (CAPM) explains how risk should be considered when stocks and other assets are held The CAPM states that any stock's required rate of return is the risk-free rate of return plus a risk premium that reflects only the risk remaining -Select- V diversification. Most individuals hold stocks in portfolios. The risk of a stock held in a portfolio is typically ] the stock's risk when it is held alone. Therefore, the risk and return of an individual stock should be analyzed in terms of how the security affects the risk and return of the portfolio in which it is held. is generally because diversification the portfolio's risk. Quantitative Problem: You are holding a portfolio with the following investments and betas