Unique Diversification Benefit


 

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Unique Diversification Benefit

Reduction in the likelihood of financial distress for a conglomerate firm that comes with its diversified investments.



Unique Diversification Benefit

Similar Matches

International diversification

International diversification

The attempt to reduce risk by investing in more than one nation. By diversifying across nations whose economic cycles are not perfectly correlated, investors can typically reduce the variability of their returns.


Efficient diversification

Efficient diversification

The organizing principle of modern portfolio theory, which maintains that any risk-averse investor will search for the highest expected return for any particular level of portfolio risk.


Sector diversification

Sector diversification

Constituting of a portfolio of stocks of companies in each major industry group.


Currency diversification

Currency diversification

Using more than one currency as an investing or financing strategy. Exposure to a diversified currency portfolio typically entails less exchange rate risk than if all the portfolio exposure were in a single foreign currency.


Principle of diversification

Principle of diversification

That portfolios of different sorts of assets differently correlated with one another will have negligible unsystematic risk. In other words, unsystematic risks disappear in diversified portfolios, and only systematic risks persist, those related to particular assets.


Further Suggestions

Diversification
diversification
Cone of diversification
Liquidity diversification
Naive diversification
Indirect diversification benefits
Markowitz diversification
Diversification cone


 
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