'Risk prem' presentation slideshows

CHAPTER 6

CHAPTER 6. Efficient Diversification. Diversification and Portfolio Risk. Market risk Systematic or Nondiversifiable Firm-specific risk Diversifiable or nonsystematic. Figure 6.1 Portfolio Risk as a Function of the Number of Stocks.

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CHAPTER 6

CHAPTER 6. Efficient Diversification. Diversification and Portfolio Risk. Market risk Systematic or Nondiversifiable Firm-specific risk Diversifiable or nonsystematic. Figure 6.1 Portfolio Risk as a Function of the Number of Stocks.

334 views • 32 slides

Chapter 7

Chapter 7. Efficient Diversification. n. S. W. =. 1. i. i. =1. Two-Security Portfolio: Return. r p = W 1 r 1 + W 2 r 2 W 1 = Proportion of funds in Security 1 W 2 = Proportion of funds in Security 2 r 1 = Expected return on Security 1 r 2 = Expected return on Security 2.

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Utility Examples

Utility Examples. Scott Matthews Courses: 12-706 / 19-702. Utility Functions. We might care about utility function for wealth (earning money). Are typically: Upward sloping - want more. Concave (opens downward) - preferences for wealth are limited by your concern for risk.

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Chapter 10

342 views • 15 slides

Chapter 10

256 views • 14 slides

CHAPTER 6

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CHAPTER 6

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