~/ home / finance / glossary / portfolio risk

Few people truly understand the complexities of portfolio risk.

Beginner

Portfolio risk is the general term for riskiness or dispersion of returns on a portfolio of assets. There are several different ways risk can be measured and interpreted. It can be measured using the stream of values of a portfolio, like the NAV on a mutual fund, or from a bottom-up calculation using individual positions and weights. The latter requires covariance calculations between all combinations of stocks. Portfolio risk can also be compared to other portfolios, or benchmarks, on a relative basis.

Synonym: portfolio variability

Click box for answer.

True

**Pat: ***As your CEO, I encourage every employee
to learn the calculations of
*portfolio risk *.*

**Eve: ***Yes, I concur. It's the best way to
reduce career risk.*

Many terms have 4-5 minute videos showing a derivation and explanation. If this term had one, it would appear here.

Videos can also be accessed from the YouTube Channel.

If this term had a video, the script would be here.

Our trained humans found other terms in the category
**portfolio risk** you may find helpful.

For links to all glossary terms and videos click the Outline button below.

New videos are coming your way on our YouTube Channel. Subscribe now.

Next, we dig a bit deeper in risk with portfolio specific risk . Click Next.

~/ home / finance / glossary / portfolio risk

Keywords:

portfolio risk

portfolio variance

portfolio standard deviation

dispersion

variability

returns-based

holdings-based

investment

Modern Portfolio Theory

MPT

covariance matrix

relative risk

absolute risk