Although unique risk is present in differing amounts, individual stocks are:
A) exposed to the same amount of market risk.
B) exposed to differing amounts of market risk also.
C) not exposed to market risk; only the general economy is subject to market risk.
D)able to diversify away their market risk.

Question

Quizplus · Accepted Answer

Individual stocks are exposed to differing amounts of market risk, depending on various factors such as the company's industry, financial health, and market conditions. While diversification can help mitigate some market risk, it cannot eliminate it entirely for individual stocks.

Although Unique Risk Is Present in Differing Amounts, Individual Stocks