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A risk-averse investor owning shares in Mandara Corporation decides to add the shares of either Glenlone Corporation or Chisipite Corporation to her portfolio. All three
A risk-averse investor owning shares in Mandara Corporation decides to add the shares of either Glenlone Corporation or Chisipite Corporation to her portfolio. All three shares offer the same expected return and total risk. The covariance of returns between Mandara and Glenlone is +1, and Mandara and Chisipite is + 0,05. Portfolio risk is expected to:
1 Decline more by buying Glenlone Corporation
. 2 Increase more by buying Chisipite Corporation.
3 Remain the same by buying Chisipite Corporation.
4 Remain the same by buying Glenlone Corporatio
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