Diversifiable risk

Diversifiable risk
Diversifiable risk is simply risk that is specific to a particular security or sector so its impact on a diversified portfolio is limited.

Diversifiable Risk
Diversifiable Risk definition :
Related: Unsystematic risk
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Nondiversifiable risk
Definition: [crh] Risk that cannot be eliminated by having a large portfolio of many assets.

Diversifiable Risk The components of an asset's risk that can be eliminated when the asset is combined in a well-diversified portfolio.

Diversifiable risk
Related: Unsystematic risk
Diversification
Dividing investment funds among a variety of securities with different risk, reward, and correlation statistics so as to minimize unsystematic risk.

Undiversifiable risk
Related: Systematic risk
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Nondiversifiable risk
Risk that cannot be eliminated by having a large portfolio of many assets.
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Diversifiable risk Related:
Dividend A dividend is a portion of a company's profit paid to common and preferred shareholders. A stock selling for $20 a share with an annual dividend of $1 a share yields the 5%.

See:diversifiable risk or unsystematic risk.
First-call
With collateralized mortgage obligation (C.M.O.s), the start of the cash flow cycle for the cash flow window.

See: Diversifiable risk or unsystematic risk
Firm's net value of debt
Total firm value minus total firm debt.
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Also called undiversifiable risk or market risk, the minimum level of risk that can be obtained for a portfolio by means of diversification across a large number of randomly chosen assets. Related: unsystematic risk
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Also called undiversifiable risk or market risk.
Systematic risk principle
Only the systematic portion of risk matters in large, well-diversified portfolios. Thus, expected returns must be related only to systematic risks.

Undiversifiable risk Related: Systematic risk Unearned income (revenue) Income received in advance of the time at which it is earned, such as prepaid rent.

Nondiversifiable risk Risk that cannot be eliminated by diversification. Nonmarketed claims Claims that cannot be easily bought and sold in the financial markets, such as those of the government and litigants in lawsuits.

undiversifiable risk A type of risk associated with the fluctuations of the entire economic market.... unearned income The portion of a person's income that does not come from wages, such as interest...

Does R square a diversifiable risk?
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Unsystematic risk (diversifiable risk)
Risk that leads to an increase or a drop in the value of a security or portfolio and is unrelated to the market.

It depends on non-diversifiable risk measured by in the CAPM model, and the market risk premium.
Risk aversion defines how individuals request extra-return to compensate for the higher level of uncertainty.

Nondiversifiable risk
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Off Balance Sheet Financing
Off-balance-sheet financing
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The risk of a portfolio comprises systematic risk, also known as undiversifiable risk, and unsystematic risk which is also known as idiosyncratic risk or diversifiable risk. Systematic risk refers to the risk common to all securities-i.e. market risk.

Portfolio Theory - Evaluates the reduction of nonsystematic or diversifiable risks through the selection of securities or other instruments into a composite holding or efficient portfolio.

measure of systematic or undiversifiable risk of a stock. A beta coefficient of more than 1 means that the company's stock price has shown more volatility than the market index (e.g., Standard & Poor's 500) to which it is being related; usually, ...

False, the Capital Asset Pricing Model ("CAPM") indicates that the only risk that is expected to lead to a higher return is the non-diversifiable risk that is correlated with overall market risk.

to change the mix of a portfolio or the maturities of the bonds it includes, or to alter another aspect of a portfolio or financial arrangement, such as interest-rate payments or currencies systematic risk/market risk/non-diversifiable risk The ...

Any insurance system, public or private, must raise revenues, pay providers, control moral hazard, and bear some nondiversifiable risk.

Beta is a measure of the systematic, non-diversifiable risk of an investment. The beta coefficient of a security, fund, or portfolio represents its market sensitivity, relative to a given market index and time period.

FIRM-SPECIFIC RISK - See: Diversifiable risk or unsystematic risk
FIRREA - Is the Financial Institutions Reform, Recovery, and Enforcement Act of 1989.
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Also called the diversifiable risk or residual risk. The risk that is unique to a company such as a strike, the outcome of unfavorable litigation, or a natural catastrophe that can be eliminated through diversification. Related: Systematic risk.

Unsystematic risk, also known as specific risk or diversifiable risk is the risk inherent in each investment. Investors can offset specific risk with proper diversification.

Therefore, it is also termed 'Undiversifiable RISK'. However, by diversifying internationally, an investor can reduce the level of systematic risk of a PORTFOLIO; ...

The RISK that remains after DIVERSIFICATION, also known as market risk or undiversifiable risk. It is systematic risk that determines the RETURN earned on a well-diversified portfolio of ASSETS.
Systemic risk ...

Also known as "specific risk", "diversifiable risk" or "residual risk".
The Capital Asset Pricing Model: An Overview
Modern Portfolio Theory: Why It's Still Hip
Determining Risk And The Risk Pyramid
Building An All-ETF Portfolio ...

Systematic Risk - The risk inherent to the entire market or entire market segment.
Also known as "un-diversifiable risk" or "market risk."
Financial Terms (S)
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A non-controllable, non-diversifiable risk that is common to all investments within a given asset class. With equities it is called market risk, with fixed income securities it would be interest rate risk.
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Systematic Risk: Risk associated with the market, which cannot be diversified away. Also known as non-diversifiable risk (as measured by an asset's beta).
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See also: Systematic risk, Expected return, Expense, Unsystematic risk, Banks