What investment is more likely to reduce risk, a pro basketball team or a pharmaceutical company?
Not what you're looking for?
The owner a pro football team plans to diversify by purchasing shares in either a company that owns a pro basketball team or a pharmaceutical company. Which of these two investments are more likely to reduce the overall risk the owner will face? Why?
Purchase this Solution
Solution Summary
The solution explains how diversification works in portfolio management in 156 words.
Solution Preview
Risk is reduced when a portfolio is invested in different unrelated industry. The diversification in the portfolio is of primary importance as low trends in one can be equally by high in another.
Owning a pro football team ...
Purchase this Solution
Free BrainMass Quizzes
Lean your Process
This quiz will help you understand the basic concepts of Lean.
Organizational Leadership Quiz
This quiz prepares a person to do well when it comes to studying organizational leadership in their studies.
Academic Reading and Writing: Critical Thinking
Importance of Critical Thinking
Basic Social Media Concepts
The quiz will test your knowledge on basic social media concepts.
MS Word 2010-Tricky Features
These questions are based on features of the previous word versions that were easy to figure out, but now seem more hidden to me.