Georgia Assessments for the Certification of Educators GACE Practice Test

Disable ads (and more) with a membership for a one time $2.99 payment

Prepare for the Georgia Assessments for the Certification of Educators GACE Test with our comprehensive study tools. Use multiple choice questions with explanations and hints to get ready for your exam!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

Which of the investors has the portfolio that is exposed to the greatest amount of risk?

Investor A
Investor B
Investor C
Investor D

The correct answer is: Investor A

To determine which investor has the portfolio exposed to the greatest amount of risk, it's important to consider various factors that contribute to portfolio risk, such as the types of assets held, their volatility, diversification, and overall market trends. If Investor A is identified as having the greatest amount of risk, it may indicate that this investor has a portfolio concentrated in high-volatility stocks, lacks diversification by investing heavily in a single sector or type of asset, or holds assets that are sensitive to market fluctuations. Such characteristics lead to greater exposure to downturns in the market and, consequently, higher risk. In assessing the risk levels of the other investors, they might have diversified portfolios with a mix of asset types and lower volatility investments, which would reduce their overall risk exposure. This distinction highlights why Investor A's portfolio stands out in terms of risk exposure.