2024 – Week 4 Discussion 1 Risk Return and Diversification Imagine you have the option to invest in three different opportunities
Week 4 Discussion 1 – Risk, Return And Diversification Imagine You Have The Option To Invest In Three Different Opportunities: A, B And C. Let’s Also Say That You Have Analyzed The Risks And You Believe You Can Classify Them As Low-risk, Medium-risk And – 2024
2024 – Week 4 Discussion 1 Risk Return and Diversification Imagine you have the option to invest in three different opportunities.
Week 4 Discussion 1 – Risk, Return and Diversification
Imagine you have the option to invest in three different opportunities: A, B and C. Let’s also say that you have analyzed the risks and you believe you can classify them as low-risk, medium-risk and high-risk, respectively.
Information potentially change
Now let’s say the returns of opportunities A and B are highly correlated with the market as a whole but those of opportunity C have a very low correlation with the overall market.
Investor views
Now imagine that another investor views the risks to be exactly the opposite of your view (that is, she views opportunity C to be the least risky, followed by B and then A). Assume your view of the risks is the same as described earlier.
Relate
Try and relate your explanations to the concepts from the readings this week.
MICROSOFT WRWeek 4 Discussion 1 – Risk, Return and Diversification
Imagine you have the option to invest in three different opportunities: A, B and C. Let’s also say that you have analyzed the risks and you believe you can classify them as low-risk, medium-risk and high-risk, respectively.
Information potentially change
Now let’s say the returns of opportunities A and B are highly correlated with the market as a whole but those of opportunity C have a very low correlation with the overall market.
Investor views
Now imagine that another investor views the risks to be exactly the opposite of your view (that is, she views opportunity C to be the least risky, followed by B and then A). Assume your view of the risks is the same as described earlier.
Relate
Try and relate your explanations to the concepts from the readings this week.
Scholarly reviewed citation
MICROSOFT WORD, 1-2 PAGES , APA FORMAT AND SCHOLARLY REVIEWED CITATION.
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