Asked by Rodina M. Richard on Jun 28, 2024

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Non-diversifiable risk is measured by standard deviation.

Non-diversifiable Risk

The portion of risk that can't be eliminated through diversification, often related to systemic factors affecting all investments.

Standard Deviation

A statistical measure that quantifies the amount of variation or dispersion of a set of data values.

  • Become familiar with the disparities between systematic and unsystematic risk.
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ZK
Zybrea KnightJul 04, 2024
Final Answer :
False
Explanation :
Non-diversifiable risk, also known as systematic or market risk, is typically measured by beta, not standard deviation. Standard deviation measures the total risk of an investment, including both non-diversifiable (systematic) and diversifiable (unsystematic) risks.