low risk investments have... - Answer-lower expected returns
high risk investments have... - Answer-higher expected returns
the least risky investment - Answer-treasury bills
the most risky investment - Answer-small company common stocks
price/return volatility is a way to measure? - An...
beta is a measure of... - Answer-market magnification
, systematic risk is measured by... - Answer-beta
the market related risk that you are paid to take is... - Answer-systematic
the risk that cannot be diversified away is... - Answer-systematic
the firm specific risk that affects the return of that firm or industry only is... - Answer-
unsystematic
the risk that can be diversified away is... - Answer-unsystematic
in a diversified portfolio, which risk averages out to be 0? - Answer-unsystematic
which risk are you not paid to take? - Answer-unsystematic
alpha is a measure of... - Answer-performance
alpha equation - Answer-= observed return of asset - expected return of asset
a positive alpha is... - Answer-good
a negative alpha is... - Answer-bad
gross returns are before... - Answer-expenses
net return equation - Answer-= gross returns - expenses
using gross returns, the average mutual fund has an alpha of... - Answer-0%
good performance in the past is not an indicator of... - Answer-good performance in the
future
using net returns, the average mutual fund alpha is... - Answer--1.2%
if a stock is above the risk-return line it is... - Answer-undervalued
if a stock is below the risk-return line it is... - Answer-overvalued
in efficient markets, asset prices react very quickly to the receipt of... - Answer-new info
a market where all investments are accurately priced is called... - Answer-efficient
an efficient capital market means that there are no... - Answer-good or bad investments
in efficient markets, each investment offers an expected return to match... - Answer-its
level of risk
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