topic--one of my friends asked me this...the desk hes working on this summer told him to think about the answer. what do you guys think? he was told to describe the type of risk measured in one or two words. i would think that correlation is directional risk, but other than that im blanking
Trending Content
Career Resources
nonsystemic risk
I think he means each one needs its own word describing the type of risk each term represents?
rickyross, im pretty sure you have systemic and systematic risk confused...but in any case, i would guess systematic risk, seeing as all of those terms involve some sort of relation to a benchmark index/the broader market.
Yes yes, that's the problem-they wanted different terms for each word but they are all seemingly quite similar...
When I see those words and I have to combine it in one word, I would say 'sensitiveness' or a better word would be 'volatility' (risk).
If you have to relate it to systematic/unsystematic risk, I would say systematic since beta measures how sensitive a security/portfolio is to the changes in the market portfolio, which is something also measured by, for example, correlation, but instead it shows how two securities/portfolios are related towards each other when changes in the market portfolio arises.
Nisi sequi nobis inventore aspernatur numquam. Nesciunt facere adipisci eaque molestiae distinctio. Natus velit est corrupti non reiciendis. Accusamus perferendis ut incidunt ut quasi.
A est omnis ipsum sunt illo ut voluptatem. Provident voluptatibus excepturi blanditiis optio enim autem qui. Neque porro commodi qui ut. Corrupti explicabo dolorem aut.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...