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Compute the non-systematic risk in terms of standard deviation for Fund A and Fund B. Fund A (A) Fund B (B) Market Index Fund (M)

Compute the non-systematic risk in terms of standard deviation for Fund A and Fund B.

 

Fund A (A) Fund B (B) Market Index Fund (M) T-bill money market fund (T) Average Return 24% 14% 18% 8% Standard Deviation of CAPM Beta Returns 32% 25% 20% 0% 0.5 0.2 O

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ANSWER The nonsystematic risk also known as the idiosyncratic risk refers to the risk that is specif... blur-text-image

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