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What Can You Assume About an Investor Whose Diversified Portfolio

question 27

Multiple Choice

What can you assume about an investor whose diversified portfolio of stocks yielded 25% when the market portfolio yielded 15%?


Definitions:

Income

The money a person or business receives in exchange for providing a good or service or through investing capital.

Research

The systematic investigation into and study of materials and sources to establish facts and reach new conclusions.

Standard Deviation

A statistical measure of the dispersion or variability of a set of numbers, showing how much variation exists from the average.

Risk-averse

Describes individuals or entities that prefer to avoid risk and would rather settle for a less uncertain outcome than a potentially higher but risky return.

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