Answer to Question #202722 in Management for Vishakha Dhoka

Question

explain portfolio risk and return, computation of portfolio risk an asset case

Answer 1

Portfolio risk is a chance that the combination of assets or units, within the investments that you own, fails to meet financial objectives.

It is computed by considering the weighted standard deviation and covariance of the portfolio.

Portfolio return refers to the gain or loss realized by an investment portfolio containing several types of investments. The basic expected return formula involves multiplying each asset's weight in the portfolio by its expected return, then adding all those figures together.