We can use a graph to understand this. We can plot the riskiness of the portfolio by using the standard deviation (volatility of returns) on the y-axis and the number of stocks in the portfolio on the x-axis. You will notice that as the number of securities in the portfolio increases,...
Summary The present financial crisis illustrates in a dramatic fashion that a deeper understanding of portfolio credit risk is needed. Diversification has only a very limited effect on the tail risk of credit portfolios. This chapter presents a short introduction to the Merton model. It considers ...
It does mean, rather, spreading out risk by having not only those tech firm stocks in your portfolio but also large cap stocks, small cap stocks, bonds, real estate and cash. If one of those asset classes isn't doing well, the others will help cushion any blow. What's more, if all...
Modern Portfolio Theory was first developed with individual securities in mind but can also be applied to combinations of asset classes. To understand the benefits of global diversification, it is useful to separate the risk of investments into two broad types, security-specific risks and market ...
Chateauneuf, A., Tallon, J.-M.: Diversification, convex preferences and non-empty core in the Choquet expected utility model. Econ. Theory19, 509–523 (2002) Google Scholar Chaves, D., Hsu, J., Li, F., Shakernia, O.: Risk parity portfolio vs. other asset allocation heuristic portfoli...
We consider the risk minimization problem, with capital at risk as the coherent measure, under the Black-Scholes setting. The problem is studied, when there exists additional correlation constraint between the desired portfolio and another financial index, and the closed form solution for the optimal...
PortfolioRisk MeasuredbyportfoliostandarddeviationNotasimpleweightedaverageofthestandarddeviationsofindividualsecuritiesintheportfolio.Why?Howtocomputeportfoliostandarddeviation?SignificanceofCovariance Anabsolutemeasureofthedegreeofassociationbetweenthereturnsforapairofsecurities.Theextenttowhichandthedirectioninwhichtwovariables...
Risk and return of project-based climate change mitigation: a portfolio approach Since not all project types are affected by the same factors, diversification is a viable risk reduction strategy. We propose a methodology for quantifying... LU Springer - 《Global Environmental Change》 被引量: 40...
At first,the relevant theory of diversifying investment risk through portfolio is introduced.Based on this,we make an empirical analysis on the relationshi... YANG Jiping,ZHANG Lijian,杨继平,... - 《系统工程理论与实践》 被引量: 10发表: 2005年 Income diversification and bank efficiency in an em...
英[daɪˌvɜː(r)sɪfɪˈkeɪʃ(ə)n] n.多样化;【商】(投资的)分散经营 网络多元化;分散投资;多种经营 同义词 反义词 n. change,divergence,variation,modification,broadening 英汉 英英 网络释义 n. 1. 形形色色,多样化 2. ...