Explain the difference between portfolio risk and stand-alone risk. Briefly explain why you selected each stock and how this investment portfolio would have less risk than selecting just one stock.

Unit 3 Finance Case Study

Instructions
Diversified Risk Stock Portfolio

For this case study, you will create a portfolio of five to eight stocks that demonstrate diversified risk. List the stocks along with their current price and previous 1-year and 5-year rates of return. Below the list of stocks, address the issues described below.

Explain the difference between portfolio risk and stand-alone risk.
Briefly explain why you selected each stock and how this investment portfolio would have less risk than selecting just one stock.

How does risk aversion affect a stock’s required rate of return?
Explain the distinction between a stock’s price and its intrinsic value.

Your case study should be at least two pages in length, not counting the title and reference pages.
Use APA format to cite in-text and reference citations.

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