Research / Research Papers

The Use of Leveraged Investments to Diversify a Concentrated Position

Published in the Securities Arbitration 2004 Handbook PLI.

2004-06-01

Brokerage firms recently recommended that investors holding a concentrated position in a single stock borrow and invest in a portfolio of additional stocks to reduce risk. Dr. McCann and Dr. Luo demonstrate that this strategy to reduce risk predictably did exactly the opposite.

By Craig McCann and Dengpan Luo

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Craig J. McCann
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