Running head: INDIVIDUAL ASSET ALLOCATION
Individual Asset Allocation
INDIVIDUAL ASSET ALLOCATION
Equity Analysis: Individual Asset Allocation
Systematic risk analysis is essential in determining the vulnerability of the portfolio to
the events that can impact aggregate outcomes. A current example is a Covid-19 epidemic,
which is currently affecting the companies' and industries' aggregate income and market returns.
Beta is a tool that indicates the correlation between the expected return from an asset and
market-wide return. Beta indicates the vulnerability of the portfolio to systematic risks (Savor, &
Wilson, 2016). Therefore, analysis of systematic risks is necessary for optimal allocation of the
portfolio in different assets. Based on this analysis, a portfolio of $1 million can be optimally
allocated in different three assets; U.S Treasury bonds, Equity, and cash. Investors h...
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