Which one of the following risks is irrelevant to a well-diversified investor?
A) Systematic risk
B) Unsystematic risk
C) Market risk
D) Non-diversifiable risk
E) Systematic portion of a surprise

Question

Quizplus · Accepted Answer

Unsystematic risk is the risk that can be diversified away in a well-diversified portfolio. Therefore, it is irrelevant to a well-diversified investor. Systematic risk (A), market risk (C), and non-diversifiable risk (D) are all relevant to a well-diversified investor as they cannot be eliminated through diversification. The systematic portion of a surprise (E) is a concept that is not directly related to the question being asked.

Which One of the Following Risks Is Irrelevant to a Well-Diversified