Of the four plans that mentioned uncompensated risk in their IPSs, only one county discussed the reduction of uncompensated or nonsystematic risk
in any depth.
GSAs with a single cohort can only pool nonsystematic risk
In other words, the objective of the study is to investigate the relationship between nonsystematic risk
and smoothed profits (high-quality and low-quality).
Just as in a well diversified portfolio of stocks it is possible to eliminate the unique nonsystematic risk
of an individual asset, in the case of a debt portfolio, it was assumed that the possible insolvency of one of several hundred borrowers would not have any material impact on the total value of a specific group of mortgages.
Thus, diversifying the production activities in a region will tend to reduce nonsystematic risk
Confined to a smaller subset of investment choices, SRFs may carry substantial sector biases, thus increasing nonsystematic risk
(Kurtz and DiBartolomeo 1996).
with standard portfolio analysis in which systematic risk and expected profit are negatively correlated but nonsystematic risk
cannot be eliminated.
The return on an individual housing transaction is positively associated with national returns, but the association is not strong, which indicates a high level of nonsystematic risk
in housing transactions.
Researchers and investors have found that a major benefit of investing in indices is the diversification effect which reduces dispersion or nonsystematic risk
This does not require that the nonsystematic risk
be identical for all companies.
Another example of nonsystematic risk
would be loan-type risks, such as high loan-to-value ratios or investor loans.
Comparability, or lack thereof, is a function of the similarity of the historical returns of the practice and the nonsystematic risk
features of the practice -- as compared to the same elements for the sample transactional firms.