Asked by Yousef Abualhawa on May 07, 2024
Verified
Non-diversifiable risks are those risks you cannot avoid if you are invested in the financial markets.
Non-diversifiable Risks
Risks that affect all investments across the market and cannot be mitigated through diversification.
Financial Markets
Marketplaces where individuals and entities can trade financial securities, commodities, and other fungible items of value at low transaction costs and at prices that reflect supply and demand.
- Acquire knowledge on the differentiation between systematic and unsystematic risk.
Verified Answer
TL
TUYEN LE NGUYEN LANMay 14, 2024
Final Answer :
True
Explanation :
Non-diversifiable risks, also known as systematic risks, affect the entire market or a large segment of the market and cannot be avoided through diversification. Examples include economic recessions, political instability, and changes in interest rates.
Learning Objectives
- Acquire knowledge on the differentiation between systematic and unsystematic risk.
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