Essays on Covariance

1. An investor does not need to make a decision which portfolio to choose when a risk free asset is included. There is now only one tangent portfolio he can choose. Explain this statement with graphs analysis. The line of possible portfolio risk and return combinations given the risk-free rate and the risk and return of the portfolio of risky assets is called capital allocation line(CAL). For an individual investors and under the assumption of CAPM model that each investor faces homogeneous expectations, the best capital allocation line is the one that offers the highest expected utility in ...

Based on the above discussion, recommend and justify the risk exposures that should be reported as part of an Enterprise Risk Management System for the Toyota Motor Company? (10 Marks) The first risk that Toyota is faced with is the investment in commodities. Commodities such as non-ferrous metals, precious metals, ferrous alloys, energy, and plastic resin from outside sources may be subjected to price changes. Changes in prices can have a negative impact on the productivity for Toyota because inflated prices may result in delayed projects and the inability to complete planned products based on a lack of resources. ...

“Diversification eliminates unique risk. But there is some risk that diversification cannot eliminate”

Diversification of portfolios is one of the effective ways to minimize the risks and increase the returns. However, it is acclaimed that there are certain risks that cannot be eliminated. These risks are called market risks that cannot be overcome through diversification of the portfolio. There are several theories that stress that the diversification of portfolios should be used to bring stability in its returns and lessen the risks. Systematic risks or market risk emerged because of the changes in the economic cycles of the market that are influenced by various factors and activities taken place in the economy ( ...

Attitudes and Beliefs of Hypnosis amongst Mental Health Professionals and the Impact on the Availability of Hypnosis Training in Counseling Training Programs

Abstract

Nine out of ten general practitioners are approached by their patients for information regarding alternative and complementary therapies, including hypnotherapy, and three out of four GPs provide referalls for hypnotherapy (Hall & Giles-Corti, 2000). A minority of healthcare providers, however, has ever received formal education and training in hypnosis, and a majority relies on lay information from the media and other non-authoritative sources to form its opinions about the merits or demerits of hypnotherapy. Mental healthcare standards dictate ...

Introduction

In this paper, the article titled “Effect of 2-yn− 3 long-chain polyunsaturated fatty acid supplementations on cognitive function in older people: a randomized, double-blind, controlled” by Dangour et al., 2010 will be critically appraised. The article describes a study that sought to establish whether 2-yn− 3 long-chain polyunsaturated fatty acid supplementation has an effect on cognitive function in older people. In the study, a randomized, double-blind, controlled trial was used. Reduced cognitive function and dementia in older people continues to increase and pose a significant challenge to the elderly. Several studies have reported an association between the intakes of ...

Value-at-Risk

Introduction Risk assessment is essential in portfolio management. A portfolio manager has the duty of maximising returns of the portfolio of the assets for each level of risk. Alternatively, a portfolio manager should minimise the risk of the portfolio at any level of return of the portfolio. Several models are used in assessing the risk involved in a portfolio of investments. Value-at-risk is widely applied in determining portfolio risk. We explore the concept of value-at-risk and its usage in portfolio management.

It is a model that measures how much the value of a portfolio could fall over a specified ...

Explain the difference between multiple independent variables and multiple levels of independent variables. Which is better?

It is important to note that design experiment requires researchers to decide on the type of dependent variable that they should use in their respective study and distinguish the same from the independent variables. However, every research ought to have a single dependent variable, but the independent variables can be many, an aspect that makes the independent variables be considered as parameters. Therefore, for our case, multiple independent variables indicate the use of many parameters in conducting a study. For example, if we take a survey to find the extent of obesity in a given area, and take the ...

Risk is defined as uncertainty in broad terms. This uncertainty can be due to a large number of factors, which depend on the type of risk. Some of the common factors which result in this uncertainty can be changes in input parameters, miscalculation of parameters etc. (Kuritzkes, Schuermann, & Weiner, 2002). Risk can result in large and unexpected losses and can really hurt the profitability of companies. However, risk is not always bad and little bit of risk can lead to better financial results. However, the relationship between risk and better results is a lot more complex and depends on ...