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a)What is diversification? How does diversification work? Can all risks be diversified? Please explain how diversification reduces portfolio risk? b)Describe, how diversification is achieved. Explain

a)What is diversification? How does diversification work? Can all risks be diversified? Please explain how diversification reduces portfolio risk?

b)Describe, how diversification is achieved. Explain whether diversification lowers the expected return on a portfolio.

c)What is the value of portfolio diversification and explain the three primary asset classes included in portfolio diversification, and why each asset class is important.

d)What is the diversification principle?

e)Explain why diversifying between assets with low or no correlation reduce overall risk?

f)Explain how diversification might mitigate portfolio risk and give an example of a portfolio mix you think would represent a diversified portfolio. Explain your choices, including a discussion of Beta and what that means in terms of overall risk

g)Diversification cannot reduce the portfolio risk if you invest different stocks in the same industry. Why? Explain. Diversification reduces the portfolio risk if you invest different stocks in the different industries. Why? Explain If you would like to form your stock investment portfolio, (1) how many stocks would you include in the portfolio, and (2) what are these stocks (companies) in the portfolio. Explain why you choose these companies.

h)Can every type of risk be avoided by diversification? Explain fully

i)Explain the difference between systematic and unsystematic risk, using relevant examples and explain how diversification affects each of the risks above

j)Without resorting to mathematics, explain how diversification reduces the overall risk of an investment portfolio. Do you think that most investors truly understand the "magic" of diversification and strive to reduce the risk of their portfolio by combining a number of different stocks? Why or why not? Justify, with examples.

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a)Pls define and explain how each of the following is used in corporate finance and support your answer with examples:

-ordinary annuity

-annuity due

-deferred annuity

-perpetuity.

b)What is the difference between an ordinary annuity and an annuity due?

c)How is the difference between an ordinary annuity and an annuity due affect the PV and FV of two otherwise identical annuities?

d)How to identify the deferred annuities? What are the types of deferred annuity? Please give examples.

e)Analyze how deferred annuity works in some businesses. Provide analysis on the function of deferred annuity and how this type of annuity help small businesses to grow financially.

f)Can you explain what a perpetuity is and how to calculate its present value?

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Compare and contrast the advantages and limitations of the original Capital Asset Pricing Model (CAPM) to the following main alternatives asset pricing models:

The zero-beta CAPM

The three-moment CAPM

The intertemporal CAPM

The Arbitrage Pricing Theory (APT)

Support your discussion with evaluating empirical evidence and research into the main alternatives asset pricing models and contrast these conclusions with the original Capital Asset Pricing Model (CAPM) methodology.

(Intro of asset pricing models with 3 advantages each and 3 limitations each, with concluding analysis at end)

With max 500 words

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