An asset's undiversifiable risk is measured by its ______________.
A) Total return.
B) Expected return.
C) Variance of returns.
D) Unexpected component of returns.
E) Beta coefficient.

Question

Quizplus · Accepted Answer

An asset's undiversifiable risk, also known as systematic risk, is measured by its beta coefficient. The beta coefficient reflects how an asset's returns move in relation to the overall market, capturing the risk that cannot be eliminated through diversification.

An Asset's Undiversifiable Risk Is Measured by Its ______________