Systematic risk:
A) is the standard deviation of a security's return.
B) is measured with beta.
C) is measured with standard deviation.
D) none of the above

Question

Quizplus · Accepted Answer

Systematic risk is the risk that cannot be diversified away and affects the entire market or a particular sector. It is measured with beta, which is a measure of how much a security's return moves in relation to the market as a whole. Option A refers to the total risk of a security, which includes both systematic and unsystematic risk. Option C is not entirely accurate, as standard deviation may also include unsystematic risk. Option D is not correct as the question specifically asks for the measure of systematic risk.

Systematic Risk