You are thinking of adding one of two investments to an already well- diversified portfolio. If you are a risk-averse investor,which one is the better choice?
A)Security A
B)Security B
C)Either security would be acceptable because they have the same beta.
D)Security B,but only if Security B's required return is greater than 12%

Question

You are thinking of adding one of two investments to an already well- diversified portfolio.  If you are a risk-averse investor,which one is the better choice?
A)Security A 
B)Security B 
C)Either security would be acceptable because they have the same beta. 
D)Security B,but only if Security B's required return is greater than 12%

Quizplus · Accepted Answer

The Answer of You are thinking of adding one of two investments to an already well- diversified portfolio.  If you are a risk-averse investor,which one is the better choice?
A)Security A 
B)Security B 
C)Either security would be acceptable because they have the same beta. 
D)Security B,but only if Security B's required return is greater than 12%

You Are Thinking of Adding One of Two Investments to an Already