Asked by Markayla Eakins on Jun 24, 2024
Verified
The ____________ return is that portion of total return attributable to information surprises.
A) Unexpected.
B) Expected.
C) Actual.
D) Systematic.
E) Non-diversifiable.
Total Return
Total return is the full return on an investment over a specific time period, including capital gains and dividends, expressed as a percentage of the initial investment cost.
Information Surprises
Events or news that were unexpected by market participants, often leading to sudden changes in asset prices.
- Identify factors that influence asset returns and how they are measured and evaluated.
Verified Answer
FR
Fryda RodriguezJun 29, 2024
Final Answer :
A
Explanation :
The unexpected return is the portion of total return that results from information surprises, which are not anticipated by investors. Expected returns are based on known information, while unexpected returns result from new, unforeseen information affecting the asset's value.
Learning Objectives
- Identify factors that influence asset returns and how they are measured and evaluated.