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1. You have a portfolio of two risky stocks which turns out to have no diversification benefit. The reason you have no diversification is the
1. You have a portfolio of two risky stocks which turns out to have no diversification benefit. The reason you have no diversification is the returns:
| move perfectly opposite of one another. | |
| are too small. | |
| move perfectly with one another. | |
| are completely unrelated to one another. | |
| are too large to offset. |
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