Because of Portfolio Effect, the Most Significant Factor Related to the Risk

question 7

Multiple Choice

Because of portfolio effect, the most significant factor related to the risk of any investment is:

• A)its standard deviation, or degree of uncertainty.
• B)its effect on the risk of the portfolio.
• C)systematic risk associated with the investment.
• D)None of the above

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Definitions:

Heavy Drinking

The consumption of alcoholic beverages in quantities that exceed moderate drinking guidelines, potentially leading to health and social problems.

Opiate Family

A group of drugs, derived from the opium poppy, used primarily for pain relief but which can also lead to addiction and abuse.

Methadone

A heroin replacement used to treat heroin addicts, often to reduce the craving after initial withdrawal symptoms have abated. Methadone therapy appears to work best in conjunction with good individual and group psychological intervention programs, as well as ongoing peer support.

Morphine

A powerful opiate analgesic drug derived from the opium poppy, used to relieve severe pain.