In finance, risk is best judged in a portfolio context. Is this true Essay - 7

In finance, risk is best judged in a portfolio context. Is this true Why - Essay Example This paper takes an argument to prove that individual stock cannot allow investors to help judging the overall risk associated with investment on shares. A critical criticism context will also be introduced in the paper later on to justify the argument regarding risk being judged better in a portfolio of stocks. It will not be incorrect to state that investors of stock market are directly associated with the risk which is not avoidable. These risks can be variable in types such as short-term risk or portfolio risk. For the focus of this paper, portfolio risk is being discussed in a contextual manner. It should be noted that portfolio risk is relatively low in accordance to the movements within the stock market. Herein, the process or concept of aggregation is considered for calculating risk associated with an asset or for valuing a company. It is due to this reason that individual investors are suggested to manage their portfolio risk because their individual transactions are aggregated. This denotes that investors tend to diversify their assets in order to judge the risk of security (Brealey, et al., 2010). It is not being proven here that by taking an aggregate of the risk of in a portfolio can eliminate risk. Portfolio of stock allows the investors to understand the associated risk in accordance of variation in all levels of the market. There is an underlying condition associated with portfolio risk. As a matter of fact, risk can be best judged in a portfolio context, as diversified stocks can have reduced risk. The underlying condition is that the return which is received by the investors is less than one. In this case, it is stated that diversification will remain beneficial or the investors (Brealey, et al., 2010). Risk or systematic risk is interlinked with the changes that may occur in the market. The risk is

Law of Equity and Trusts Essay Example | Topics and Well Written Essays - 1000 words - 1

Law of Equity and Trusts - Essay Example The first determination of the presence of a trust is with regards to a written declaration of it. There is no written declaration for the purposes of s. 53(1)(b) of the Law of Property Act (LPA) 1925 with regards to the home. The only written declaration of the trust is Uncle David’s Will. Thus, if Lorraine has to establish an interest, it must be under the rules ofPettitt v Pettitt(1970) later affirmed by Lloyds Bank v Rosset(1991), by way of resulting or constructive trust. This would result in an equitable interest for Lorraine. Resulting trusts are formed when there is a contribution made to the purchase price, which, in this scenario is not the case.The facts do not say whether she actually contributed to the purchase price by way of outright sum or through mortgage payments, both of which are accepted ways of establishing an interest in the house, and thus, it is presumed that Jonathan was the sole proprietor of the house. Lorraine joined him as a young girlfriend, and for that reason, her interest has to be established by way of constructive trust, which is formed in the presence of an oral assurance on which reliance has been made by the claimant to her detriment (see Lloyds Bank). The promise made by Jonathan can be easily evidenced as it was in the presence of witnesses. In 2009, he declared, â€Å"all of my property including our lovely barge home is as much yours Lorraine as it is mine†. This takes the form of an oral promise, and judging from the fact that it was made on several occasions, Lorraine can establish that it amounts to an interest of some kind in the property (Ungarian v Lesnoff (1990) and Eves v Eves (1975)). Thus, the second step for Lorraine in order to establish her equitable interest in the property would be to prove that she relied upon the promise to her detriment. Lorraine spent a considerable amount on structural repairs and decoration, to the tune of 65000 pounds and contributed half of her salary to