Imagine that the assumptions of the CAPM hold. The risk of assets com

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School
Youngstown State University **We aren't endorsed by this school
Course
FIN MISC
Subject
Finance
Date
Nov 3, 2023
Pages
1
Uploaded by LieutenantHummingbird3644 on coursehero.com
Imagine that the assumptions of the CAPM hold. The risk of assets comes from systematic covariance with the market portfolio and from idiosyncratic risk. Identify if each of the following statements is true or false given this scenario. The of every asset is above 1 . Select one: True False The correlation coefficient of every asset with the market portfolio is 1 . Select one: True False The expected return for every asset lies on the SML when plotted in expected return- space (the y-axis is expected return and the x-axis is ). Select one: True False A portfolio of assets provides the same diversification benefit as a single asset with equivalent beta. Select one: True False
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Uploaded by LieutenantHummingbird3644 on coursehero.com