How does the correlation between the stocks in a portfolio affect the portfolios volatility?
Question:
How does the correlation between the stocks in a portfolio affect the portfolio’s volatility?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 100% (QA)
The correlation between the stocks in a portfolio significantly impacts its volatility which is the measure of how much the portfolios value fluctuate...View the full answer
Answered By
Umber Talat
I am providing full time mentoring and tutoring services in Business Finance, Contemporary issue in Global Economy, Quantitative Techniques, Principles of Marketing, strategic marketing, International Marketing, Organizational Behavior (OB), Consumer Behavior, Sales Force Management, Strategic Brand Management, Services Marketing, Integrated Marketing Communication (IMC), Principles of Management, General Management, Strategic Management, Small and Medium Enterprise Management, Innovation Management, Change Management, Knowledge Management, Strategic Planning, Operations Management, Supply Chain Management, Logistics Management, Inventory management, Total Quality Management (TQM), Productions Management, Project Management, Production Planning, Human Resource Management (HRM), Human Resource Development, Strategic HRM, Organizational Planning, Performance and Compensation Management, Recruitment and Selection, Organizational Development, Global Issues in Human Resource Management, Retail Marketing, Entrepreneurship, Entrepreneurial Marketing, International Business, Research Methods in Business, Business Communication, Business Ethics.
4.70+
158+ Reviews
236+ Question Solved
Related Book For
Question Posted:
Students also viewed these Business questions
-
Suppose the expected returns and standard deviations of Stocks A and B are E (R A ) = .10, E(R B ) = .12, A = .39, and B = .72. a. Calculate the expected return and standard deviation of a...
-
Suppose the expected returns and standard deviations of Stocks A and B are E(R A ) = .10, E(R B ) = .13, A = .41, and B = .59, respectively. a. Calculate the expected return and standard deviation...
-
Write the History of Heart Attack and Angina Pectoris:
-
Q3. Modulus of rupture of concrete is a measure of a) flexural tensile strength b) direct tensile strength c) compressive strength d) split tensile strength Q4. For a longitudinal reinforcing bar in...
-
Landers Ltd is a major Australian bicycle manufacturer. Over the last decade, bicycle manufactures. Taiwan and Korea have been able to price their bikes below those of the Landers products, but the...
-
Depreciation of a non-current asset is an estimate of the loss in value of the asset over the accounting period. A. True. B. False.
-
In refrigeration cycle, heat is (a) Abstracted from the lower temperature region and discarded to the higher one (b) Absorbed from the higher temperature region and discarded to the lower one (c)...
-
Yorks outstanding stock consists of 80,000 shares of noncumulative 7.5% preferred stock with a $ 5 par value and also 200,000 shares of common stock with a $ 1 par value. During its first four years...
-
The comparative balance sheets (2021, 2020) and the income statement (2021) for Company A are shown below. Additional information from the accounting records follow the statements. Prepare the...
-
How does the volatility of an equally weighted portfolio change as more stocks are added to it?
-
What does the correlation measure?
-
This dataset contains the listed prices (in thousands of dollars) and the number of square feet for 28 homes in the Seattle area. The data come from the Web site of a Seattle realtor offering homes...
-
The liver is an organ that plays important roles in multiple organ systems. What role does the liver play in digestion? What role does it play in excretion?
-
What hormone made by the hypothalamus helps regulate the amount of water in the body? What is its effect?
-
A typical person has a heart rate of 70 beats per minute and takes 12 breaths in a minute. Show that her heart beats about 4200 times an hour, 100,800 times a day, and 36.8 million times a year. Show...
-
In a developing embryo, the heart begins to beat long before developing nerves reach it. How is the embryonic heart able to beat without nervous system control?
-
In some people, the bones of the middle ear stiffen with age. This can result in deafness. Why?
-
Based on the PLC, what challenges does Samsung face in managing its high-tech products? In the world of consumer electronics, copycat brands are a dime a dozen. These are the brands consumers turn to...
-
Diamond Walker sells homemade knit scarves for $25 each at local craft shows. Her contribution margin ratio is 60%. Currently, the craft show entrance fees cost Diamond $1,500 per year. The craft...
-
What types of lease options would raise the amount of the lease payment?
-
How is a $1.00 out lease characterized for accounting and tax purposes?
-
Is it possible for a lease to be treated as an operating lease for accounting purposes and as a non-tax lease for tax purposes?
-
Singapore Digital Components Company assembles circuit boards using hand-held machinery to insert electronic components. The original cost of the machine is $60,000, accumulated depreciation is...
-
The following data were taken from the balance sheet of Nilo Company at the end of two recent fiscal years: Current assets: Current Year Previous Year Cash $348,800 $281,600 Marketable securities...
-
If Diamond Computer Company manufactures carrying cases computers, factory overhead fixed costs will not increase, and Variable factory overhead costs will be 15% of direct labor cost. A. Prepare...
Study smarter with the SolutionInn App