Calculate the DEAR for the following portfolio with the correlation coefficients and then with perfect positive correlation between various asset groups. Estimated DEAR (
S,FX) (
S,B) (
FX,B) Stocks (S) $300,000 −0.10 0.75 0.20 Foreign Exchange (FX) 200,000 Bonds (B) 250,000 What is the amount of risk reduction resulting from the lack of perfect positive correlation between the various asset groups?