Which one of the following statements applies to unsystematic risk?
A)It can be eliminated through portfolio diversification.
B)It is also called market risk.
C)It is a type of risk that applies to most, if not all, securities.
D)Investors receive a risk premium as compensation for accepting this risk.
E)This risk is related to expected returns.

Question

Quizplus · Accepted Answer

Unsystematic risk is specific to a particular company or industry and can be reduced or eliminated through diversification of a portfolio.

Which One of the Following Statements Applies to Unsystematic Risk