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By diversifying your investments according to betas, have you entirely removed the potential risk of losses due to a declining stock market?

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If one of your stocks has a relatively high beta of 1.4 and is currently doing exceedingly well, why would you want a stock in your portfolio with a relatively low beta of 0.7 that has been recently under-performing?

By diversifying your investments according to betas, have you entirely removed the potential risk of losses due to a declining stock market?

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If one of your stocks has a relatively high beta of 1.4 and is currently doing exceedingly well, why would you want a stock in your portfolio with a relatively low beta of 0.7 that has ...

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Manal Elkhoshkhany, MBA
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  • MBA, California State University, Sacramento
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