Richards & Co

question 77

Essay

Richards & Co.Analysts has recently published a study claiming that the benefits to diversification are constant.In other words, adding one more stock to a three stock portfolio will have the same impact as adding one more stock to a 500‐stock portfolio.You are not convinced and you decide to evaluate the claim.
a .Assume that all the stocks have the same standard deviation, 10.0%, and all are independent (correlation equals 0.0).Create equally weighted portfolios of 1 to 10 stocks and calculate the standard deviation for each portfolio.Graph the portfolio standard deviation as a function of the number of stocks.Based on the results of your analysis, evaluate the Richard & Co.Analysts ' claim.
b .As the number of firms increases, what do you expect will happen to the risk of the portfolio? Can the risk of the portfolio come close to zero?

Appreciate the significance of reference and primary groups on self-esteem and social behavior.

Understand the principles and effects of McDonaldization in organizational settings.

Recognize the adaptability of secondary groups during stressful situations.

Grasp the influential role of social class and race within organizational promotions and roles.

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Definitions:

Cultural Context

The social, historical, and cultural environment in which an individual lives or an event occurs, influencing its interpretation and significance.

Lesbian Couples

Romantic partnerships between two women.

Lesbian Parents

Same-sex female couples who are raising children together, whether through biological means, adoption, or other methods.

Children

Young individuals in the early stages of life who are in the process of developing physically, mentally, emotionally, and socially.