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Related to Diversifiable: Diversifiable risk, Non Diversifiable Risk


a.1.Capable of being diversified or varied.
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Can we use BTC as a diversifiable asset that is at least somewhat immune to the total market?
The trustee's duties and objectives with respect to [nondiversifiable (compensated)] risk are not as distinct as those with respect to diversifiable [uncompensated] risk.
An example of the second reason is the addition of a premium for country risk, in the belief that the country's market is not sufficiently integrated into the world market, so that this country risk would not be diversifiable, from the perspective of an international investor.
Instead, a fiduciary must evaluate the principal's risk tolerance and investment goals, choose a commensurate level of overall portfolio market risk and expected return, and avoid wasteful diversifiable risk.
ME]] mean that these diversifiable characteristics are not priced in the market, as it should be in an efficient market where the CAPM model is true model of risk.
Though the impact of this type of risk on stock prices is not fully diversifiable because it is beyond the control of the investor, the effect on the share prices may be temporary.
Notably, insurers face financial risks that are systematic because marketwide disability and lapse rates as well as business cycle conditions are not diversifiable across beneficiaries and are nearly impossible to forecast decades into the future.
By considering the tradeoff theory firm surfaces lower bankruptcy costs and large firms are no more diversifiable and borrow more.
Unfortunately, the SML only calibrates complete risk not all of which is diversifiable.
The second part of the endowment good is diversifiable income, which is not subject to idiosyncratic shocks, and is denoted by (1 - [gamma])[Y.
Furthermore, our results suggest that insurance is not a diversifiable asset.
The cost of insuring a diversifiable risk is a simple calculation of the discounted value of expected (average) future damages.

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