Bodie Marcus INVESTMENTS Fourth Edition Measuring components of risk 0 2=B2 0m2+oe) Where 2= total variance B2 0m2=systematic variance oej unsystematic variance Irwvin/McGrazo-Hill 10-9 The McGraw-Hill Companies, Inc, 1999Irwin/McGraw-Hill 10-9 © The McGraw-Hill Companies, Inc., 1999 INVESTMENTS Fourth Edition Bodie Kane Marcus σi2 = βi2 σm2 + σ2(ei) where; σi2 = total variance βi2 σm2 = systematic variance σ2(ei) = unsystematic variance Measuring Components of Risk Measuring Components of Risk