The More Volatile the Returns of Individual Investments in a Portfolio

question 103

True/False

The more volatile the returns of individual investments in a portfolio, the more volatile the portfolio's returns are over time.

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Definitions:

Minimum Return

Minimum return refers to the lowest acceptable profit or benefit that an investor expects to achieve from an investment, considering the associated risks and opportunity costs.

Gross Profit

The difference between sales revenue and the cost of goods sold, before deducting overheads, taxes, interest, and other expenses.

Income from Operations

Profit generated from a company's regular business operations, excluding deductions of interest and taxes.

Minimum Acceptable Return

The minimum return on an investment that is required by an investor or fund manager, taking into account the risk of the investment.