more volatile today than in the past. Futher discuss using the information from a study by Ca Tapi discuss if the stock market and individual Lettau, Malkiel and Xu, (2001). This study looked at 9,000 fimms from 196297. They decompo stock mto market-wide, industry-wide and firm-specific volatility. They found that while there * periods of increased volatility, for example, during the oil crisis in the 1970s, average mache volatility, as measured by standard deviation has remained relatively stable over time -14% in the 1970s, 16% in the 1980s and 11% in the 1990s. Industry volatility has also remained stable over time. Firm specific volatility, on the other hand, more than doubled from 1962 to 1997, the period of the study. The most volatile stocks moved 25% in a single day. Firm-specific risk accounts for a greater percentage of firm total risk Firm specific volatility was 65% of total volatility in 1962 and 76% in 1997. Honourable, students why is it that individual stocks can be more volatile, yet not the market as a whole. A University of Nevada study at about the same time found that 100 stocks were needed to achieve complete diversification The University of Nevada study found that the main culprits advocating too few stocks for diversification were textbooks, professional journals and the Wall Street Journal (which has since printed a story about this study.) Some individuals choose to hold portfolios with a smaller number of stocks because it is difficult to research a large number of stocks. Why are individual stocks more volatile? Why do investors think the market as a whole is more volatile? more volatile today than in the past. Futher discuss using the information from a study by Ca Tapi discuss if the stock market and individual Lettau, Malkiel and Xu, (2001). This study looked at 9,000 fimms from 196297. They decompo stock mto market-wide, industry-wide and firm-specific volatility. They found that while there * periods of increased volatility, for example, during the oil crisis in the 1970s, average mache volatility, as measured by standard deviation has remained relatively stable over time -14% in the 1970s, 16% in the 1980s and 11% in the 1990s. Industry volatility has also remained stable over time. Firm specific volatility, on the other hand, more than doubled from 1962 to 1997, the period of the study. The most volatile stocks moved 25% in a single day. Firm-specific risk accounts for a greater percentage of firm total risk Firm specific volatility was 65% of total volatility in 1962 and 76% in 1997. Honourable, students why is it that individual stocks can be more volatile, yet not the market as a whole. A University of Nevada study at about the same time found that 100 stocks were needed to achieve complete diversification The University of Nevada study found that the main culprits advocating too few stocks for diversification were textbooks, professional journals and the Wall Street Journal (which has since printed a story about this study.) Some individuals choose to hold portfolios with a smaller number of stocks because it is difficult to research a large number of stocks. Why are individual stocks more volatile? Why do investors think the market as a whole is more volatile