Question
A portfolio consists of two investments whose returns are negatively correlated. Which of the following statement is incorrect? The portfolios expected return is between the
A portfolio consists of two investments whose returns are negatively correlated. Which of the following statement is incorrect?
- The portfolios expected return is between the expected returns of the two investments in the portfolio
- The portfolios beta is between the betas of the two investments in the portfolio
- The standard deviation of the portfolios expected return is between the standard deviations of the two investments in the portfolio
- The portfolios coefficient of variation is smaller than that of any investment in the portfolio
Please provide a brief explanation
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Fundamental financial accounting concepts
Authors: Thomas P. Edmonds, Frances M. Mcnair, Philip R. Olds, Edward
8th edition
978-007802536, 9780077648831, 0078025362, 77648838, 978-0078025365
