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An analyst compute the covariance between the return of assets A and B and C and D. The number are as follow Cov(rA, rB )
An analyst compute the covariance between the return of assets A and B and C and D. The number are as follow Cov(rA, rB ) = 0.005 (1) Cov(rC , rD ) = 0.0001 (2) Given the numbers, the analyst says that assets A and B are more related than assets C and D. Explain why this could be a big mistake
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