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Assume there is a fixed exchange rate between the Euro and U.S. dollar. The expected return and standard deviation of return on the U.S. stock market are 16% and 13%, respectively. The expected return and standard deviation on the DAX stock market are 11% and 18%, respectively. The covariance of returns between the U.S. and German stock market is 1.5%.
If you invested 50% of your money in the German (DAX) stock market and 50% in the U.S. stock market, the expected return on your portfolio would be
Negligent
Describes a failure to exercise the care that a reasonably prudent person would exercise in like circumstances, leading to unintended damage or harm.
Actually Named Third Parties
Specific individuals or entities explicitly mentioned in a legal document or contract, distinguishing them from those not directly named.
Liability Theory
In law and finance, a concept that outlines the conditions under which an individual or entity can be held legally responsible for an action or event leading to damage or loss.
Blue Sky Laws
State regulations designed to protect investors against securities fraud by requiring sellers of new issues to register their offerings and provide financial details.
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