The risk premium of a stock is NOT affected by its ________.

Question

BlackTom AI · Accepted Answer

The question asks which factor does NOT affect the risk premium of a stock. We will evaluate each option in turn.
Option 1: 'undiversifiable risk' — This is synonymous with systematic risk or market risk. Since risk premia for stocks generally reflect non-diversifiable risk, this factor does influence the required return when evaluating a portfolio that cannot eliminate this risk through diversification.
Option 2: 'market risk' — Market risk is a core component of systematic risk. It cannot be fully diversified away and therefore does impact the risk premium investors demand for bearing the stock’s risk in aggregate markets.
Option 3: 'systematic risk' — Systematic risk is precisely the non-diversifiable portion of risk that affects all assets to some degree. Because investors require compensation for bearing this risk, it directly affects the risk premium.
Option 4: 'unsystematic risk' — Unsystematic, or idiosyncratic, risk is diversifiable. In a well-diversified portfolio, this risk can be largely eliminated, so it does not require a premium in the same way systematic risk does. Therefore, it does not affect the stock’s risk premium in theory.
In summary, the statements about undiversifiable risk, market risk, and systematic risk each describe factors that influence the risk premium, while unsystematic risk does not, due to diversification effects.

The risk premium of a stock is NOT affected by its ________.单项选择题

类似问题

3b) In addition, the price of U.S. stocks falls and their risk premium rises .

3b) In addition, the price of U.S. stocks [ Select ] rises falls remains unchanged moves ambiguously and their risk premium [ Select ] rises falls remains unchanged moves ambiguously .

Why do junk bonds have higher interest rates than U.S. Treasuries?

Question at position 5 A risk premium is a spread on top of the risk-free rate which uses a baseline of US Treasuries.TrueFalse

Investors require a 4 percent return on risk-free investments. On a particular risky investment, investors require an excess return of 7 percent in addition to the risk-free rate of 4 percent. What is this excess return called?

If a portfolio had a return of 11%, the risk-free asset return was 6%, and the standard deviation of the portfolio's excess returns was 25%, the risk premium would be

A risk premium is

更多留学生实用工具

智能学习助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单