Financial Analytics: Monte Carlo Simulation, CAPM, and Portfolio Management

To calculate the value-at-risk of a cryptocurrency investment

To optimize the weightings of a diversified portfolio

To estimate the expected return of a portfolio using the Capital Asset Pricing Model (CAPM)

To generate random scenarios for sensitivity analysis of a portfolio (correct)

The sum of the expected returns of individual assets

The weighted average of the expected returns of individual assets (correct)

The risk-free rate plus the market risk premium

The beta of the portfolio times the market return

Reducing the risk of the portfolio by offsetting losses (correct)

Reducing the expected return of the portfolio

Increasing the liquidity of the portfolio

Increasing the volatility of the portfolio

<p>Investors are risk-averse and demand a higher return for taking on more risk</p> Signup and view all the answers

<p>A measure of the systematic risk of an individual asset</p> Signup and view all the answers