Non-Diversifiable Risk

Non-Diversifiable Risk is risk which is common to an entire class of assets or liabilities. The value of investments may decline over a given time period simply because of economic changes or other events that impact the market.

Non-Diversifiable Risk

Non-Diversifiable Risk is risk which is common to an entire class of assets or liabilities. 

 


Application of Non-Diversifiable Risk

The value of investments may decline over a given time period simply because of economic changes or other events that impact large portions of the market.

Asset allocation and diversification can protect against non-diversifiable risk because different portions of the market tend to under perform at different times. also called systematic risk or market risk.



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