Ali wants to invest in the stock market while making its total risk zero by creating a unique portfolio. In this mode, he starts from choosing a single stock and adding multiple stocks to this one in order to develop a series of portfolios of his choice. Number of securities range from 1 to 1,000 in the different designed portfolios but he remains unable to get his desired risk level. Despite of rigorous computations, the risk level is still away from zero.

Can the total risk of portfolio be reduced exactly to zero? Why or why not? Discuss with conceptual rationale.

Important Instructions:

1. Your discussion comments must be based on logical facts.
2. Your comments should be brief and to the point. Avoid unnecessary details.
3. The GDB will remain open for 3 working days / 72 hours.
4. Do not copy or exchange your comments with other students. Two identical / copied comments will be marked Zero (0)
5. Obnoxious or ignoble comments should be strictly avoided.
6. Questions / queries related to the content of the Discussion Board, which may be posted by the students on MDB or via e-mail, will not be replied till the due date is over.

For important helping material related to the subject ( Solved MCQs, AssignmentsShort Notes, Solved Past Papers, E-Books, Recommended Books, FAQs, Help & Tutorials , Short Questions Answers & more). You must view all the featured discussion in this subject group.

Post a Comment