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Sir why would companies want to manage their risk? Or diversify it given the fact that investors are normally well diversified themselves?
Firstly, diversification is diversification of business risk – but the company still wants to manage the foreign exchange risk and the interest rate risk.
With regard to the business risk – they should not normally bother trying to diversify it (because, as you say, investors overall should be well-diversified). That is precisely the reason that they should use CAPM to determine the return required from investments depending on the risk of the investment.
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