Security selection refers to top-down analysis. O investing only in "safe" securities. the allocation of assets into broad asset classes. O choosing which individual securities to hold within each asset class.
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- What is Asset allocation: A) choosing which securities to hold based on their valuation. B) deciding how much to allocate in different asset classes. C) determining beta of securities. D) investing only in "safe" securities. Please Provide JustificationWhat is Security selection: A) determining beta of securities. B) investing only in "safe" securities. C) choosing securities for portfolio. D) top-down analysis and bottom analysis.Please provide justificationDescribe an investment portfolio and how youd go about developing, monitoring, and managing a portfolio of securities.
- Which of the following is NOT a purpose of valuing financial securities? a. Valuation is used to provide sensible financial decisions.b. Valuation is used to get the intrinsic value of a financial security.c. Valuation is helpful for investors in order to determine whether to buy or sell their securitiesd. Valuation is used to predict the exact prices of financial securities.The Capital Asset Pricing Model (CAPM) considers which type of risk in pricing the expected returns and risk of securities? A) Systemic risk. B) Unsystemic risk. C) Diversifiable risk. D) Non-market risk.Elaborate the following statements: A. Portfolio return is a linear combination of individual securities whereas portfolio risk is nonlinear.B. Portfolio Management is primarily a risk diversification tool.C. Financial Contracts are those which give simultaneous rise to the financial assets of one entity and financial liability or equity of another entity.D. Investment decision refers to the selection and acquiring the resources whereas financing decision refers to the arrangement of funds to acquire selected resources.
- 1.What is the relationship between an investment’s risk and its return? Please provide examples if possible. 2. Difference between Institutional Investors and Individual Investors.Trade, Debt and Equity are types of securities that are being considered when investing, which security is the better and safest to use?Which statement is not true regarding the market portfolio? Group of answer choices a. It includes all publicly-traded financial assets. b. It lies on the efficient frontier. c. All securities in the market portfolio are held in proportion to their market values. d. It is the tangency point between the capital market line and the indifference curve.
- Which of the following is considered the highest risk investment type? A. BondsB. StocksC. Mutual FundD. Money Market AccountA. Briefly explain three risk exposures that an analyst should report as part of anenterprise risk management systemB. Define market risk and the economic parameters considered when calculatingmarket risk.C. Explain the concept of ‘beta’ within the framework of the Capital Asset PricingModel (CAPM). Discuss the relevance of the covariance between assets returnsfor an investor wishing to diversify the risk of a portfolio. The Capital asset Pricing Model (CAPM) contends that there is systematic & unsystematic risk for an individual security. Which is the relevant risk variable & why it’s relevant?