Which one of the following will be constant for all securities if the market is efficient and securities are priced fairly?
A) Variance
B) Standard deviation
C) Reward-to-risk ratio
D) Beta
E) Risk premium

Question

Quizplus · Accepted Answer

In an efficient market where securities are priced fairly, the reward-to-risk ratio is expected to be constant across all securities. This is because the price of securities adjusts to reflect all available information, meaning that any additional risk taken by an investor should be compensated by a proportional increase in potential reward, maintaining a consistent reward-to-risk ratio.

Which One of the Following Will Be Constant for All