Economics

A portfolio manager needs to pick winners - assets or securities with high expected returns and low risk. What is wrong with this statement?

  1. 👍 0
  2. 👎 0
  3. 👁 275
  1. High returns and low risks are basically opposites. In addition, no one can accurately predict the future.

Respond to this Question

First Name

Your Response

Similar Questions

  1. Macro check and help

    A bank has $200 reserves, $800 loans, $400 securities, $1200 deposits, and $100 debt. a) Calculate the bank's capital. b) Calculate the bank's leverage ratio. c) Suppose there is a stock market boom, so that the bank's assets

    asked by maya on March 13, 2017
  2. finance

    1. The belief that investors require a higher return to entice them into holding long-term securities is the viewpoint of the A. the expectations hypothesis B. segmentation theory C. the liguidity premium theory D. market credit

    asked by Jason on July 23, 2008
  3. finance

    How does an investor earn more than the return generated by the tangency portfolio and still stay on the security market line? a. Borrow at the risk free rate and invest in the tangency portfolio. b. Add high risk/return assets to

    asked by anonymous on November 12, 2012
  4. STRATEGIC MANAGEMENT

    6. At present, suppose the risk-free rate is 10 percent and the expected return on the market portfolio is 15 percent. The expected returns for four stocks are listed together with their expected betas. Stock Expected Return Beta

    asked by Anonymous on February 2, 2019
  5. accounting

    Perez Company began operations in 2009. Since then, it has reported the following gains and losses for its investments in trading securities on the income statement: 2009 2010 2011 Gains (losses) from sale of trading securities $

    asked by weeli on December 11, 2010
  1. accounting

    The monetary contributions that the owners of IBM pay for shares of the company's stock are ____ resources for IBM. a. material b. financial c. human d. informational e. manufacturing Patents and copyrights confer value on a firm

    asked by Steven on October 29, 2012
  2. Basic Economics

    Assume the beta on Royalty Pharma's portfolio of assets is 1, the risk-free rate is 0.5% per year, and the market portfolio’s risk premium is 6% per year. According to the CAPM, what is Royalty Pharma's expected return? (Note:

    asked by Student22 on March 11, 2020
  3. finance 32

    32. the financial markets allocate capital to corporations by A. reflecting expectations of the market participants in the prices of the corporation's securities B. requiring higher returns from companies wih lower risk than their

    asked by Jason on July 24, 2008
  4. Finance

    Consider a risky portfolio. The end-of-year cash flow derived from the portfolio will be either $70,000 or $200,000 with equal probabilities of 0.5. The alternative risk-free investment in T-bills pays 6 percent per year. a) If

    asked by Blake on September 30, 2008
  5. Investments/Portfolio Mgt

    How would the following be solved... Consider a risky portfolio. The end-of-year cash flow derived from the portfolio will be either $50,000 or $150,000, with equal probabilities of 0.5. The alternative riskless investment in

    asked by Anna on November 10, 2008
  6. Finance

    Suppose that your client decides to invest in your portfolio a proportion y of the total investment budget so that the overall portfolio will have an expected rate of return of 16%. a. What is the proportion y?

    asked by sam on August 11, 2010

You can view more similar questions or ask a new question.