Diversifiable definitions
| Word backwards | elbaifisrevid |
|---|---|
| Part of speech | adjective |
| Syllabic division | div-er-si-fi-able |
| Plural | The plural form of diversifiable is diversifiables. |
| Total letters | 13 |
| Vogais (3) | i,e,a |
| Consonants (7) | d,v,r,s,f,b,l |
Diversifiable risk, also known as unsystematic risk, is the risk that is specific to an individual asset or a small group of assets. This type of risk can be reduced through diversification, a strategy that involves investing in a variety of assets to spread out risk.
How Does Diversifiable Risk Work?
When you invest in a single asset or a small group of assets, you are exposed to the risk that is specific to those assets. This risk can include company-specific factors, industry-specific factors, or even country-specific factors. By diversifying your investments across different assets, you can reduce the impact of this type of risk on your overall portfolio.
The Benefits of Diversification
Diversification can help to reduce the overall volatility of your portfolio, as different assets may perform differently under various market conditions. By spreading out your investments, you can potentially lower the risk of significant losses in any one particular asset. Diversification can also help to improve overall returns by capturing the growth potential of different sectors or asset classes.
Examples of Diversifiable Risk
Some examples of diversifiable risk include company-specific events such as a major product recall, a lawsuit against a company, or a change in senior management. These events can have a significant impact on the stock price of a single company but may have little to no effect on the overall market or other assets in your portfolio.
In conclusion, diversifiable risk is a specific type of risk that can be reduced through diversification. By spreading out your investments across different assets, you can minimize the impact of company-specific, industry-specific, or country-specific risks on your overall portfolio. Diversification is a key strategy for managing risk and optimizing returns in investing.
Diversifiable Examples
- Investors use diversifiable assets to reduce risk in their portfolios.
- By spreading investments across different industries, investors can achieve diversifiable returns.
- Diversifiable risk can be mitigated through diversification strategies.
- Financial advisors often recommend diversifiable investments for their clients.
- Diversifiable assets offer protection against market volatility.
- Investors seek to eliminate diversifiable risk through proper asset allocation.
- Diversifiable securities provide opportunities for long-term growth.
- Diversifiable sources of income can help individuals achieve financial stability.
- Businesses use diversifiable strategies to minimize exposure to market fluctuations.
- Diversifiable investments help to manage risk and optimize returns.