Which of the following statements are true?

Check All That Apply

• An asset's beta is an appropriate measure of risk if you hold it as part of a well-diversified portfolioAn asset's beta is an appropriate measure of risk if you hold it as part of a well-diversified portfolio

• An asset's variance is an appropriate measure of risk if you hold the asset alone.An asset's variance is an appropriate measure of risk if you hold the asset alone.

• A security with forecasted positive alpha will lie above the Capital Market Line (CML)A security with forecasted positive alpha will lie above the Capital Market Line (CML)

• The SML graphs a security's expected return as a function of its total riskThe SML graphs a security's expected return as a function of its total risk

• The Sharpe ratio is only valid to compare the performance of diversified portfolios not individual securities.