Examlex
The average annual return over the period 1926-2009 for small stocks is 21.2%, and the standard deviation of returns is 21.2%. Based on these numbers, what is a 95% confidence interval for 2010 returns?
Security Market Line
A graphical representation of the expected return on investments as a function of their risk, illustrating the capital asset pricing model.
Market Risk Premium
The extra return investors expect to earn from holding a risky market portfolio instead of risk-free assets.
Diversification
An investment strategy that involves spreading out investments across various financial instruments, industries, and other categories to reduce risk.
Fundamentally Different Industries
are industries that vary greatly in their nature, operations, market dynamics, and regulatory environments.
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