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Which is the best measure of risk for a single asset held in isolation, and which is the best measure for an asset held in a diversified portfolio? a. Standard deviation; correlation coefficient. b. Coefficient
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Which is the best measure of risk for a single asset held in isolation, and which is the best measure for an asset held in a diversified portfolio? a. Standard deviation; correlation coefficient. b. Coefficient of variation; beta. c. Beta; variance. d. Variance; correlation coefficient. e. Beta; beta.

User Hamish Downer
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23 votes
23 votes

Answer:

b. Coefficient of variation; beta

Step-by-step explanation:

In the case when the single asset would be held in isolation so here the best measure would be coefficient of variation

And, on the other hand the asset that held in diversified portfolio so here the beta would be considered as a best measure of risk

Also the asset held in diversified portfolio would be less risky as compared with the similar asset held in isolation

User Navyseal
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