The risks associated with owning a single stock are called:
A)systematic risk because all stocks in the system are affected.
B)market risk because the stocks are purchased in the stock market.
C)stand-alone risk because the stock stands alone outside of any portfolio.
D)business risk because the stocks represent businesses.

Question

Quizplus · Accepted Answer

Stand-alone risk refers to the specific risk associated with an individual stock, stemming from factors that affect only that particular company rather than the overall market. This can include factors such as management changes, product recalls, or lawsuits. Holding a diversified portfolio of stocks can help mitigate stand-alone risk by spreading out investments over multiple companies.

The Risks Associated with Owning a Single Stock Are Called