The risk and return characteristics of an investment should not be evaluated in isolation;instead,the risk return and return of an individual security should be analyzed in terms of how that security affects the risk and return of the portfolio in which it is held.

Question

Quizplus · Accepted Answer

Evaluating the risk and return of an investment in isolation does not provide a complete understanding of its impact on the portfolio. It is important to analyze how the security affects the overall risk and return of the portfolio it is held in. This is known as portfolio analysis.

The Risk and Return Characteristics of an Investment Should Not