An analyst for an investment fund is analyzing 175 stocks in order to construct a mean-variance efficient portfolio constrained by 175 investments and is considering whether to use the Markowitz portfolio optimization approach or the single-index model approach to choose the optimal risky portfolio.

Consider the following statements.

Statement I. Under the Markowitz portfolio optimization approach, the analyst needs to estimate 175 expected returns, 175 standard deviations of returns and 15,325 covariances between pairs of returns for a total of 16,675 estimates. Statement II. Under the single-index model approach, the analyst needs to estimate 175 expected returns, 175 estimates of sensitivity coefficients and 175 estimates of firm-specific variance, for a total of 525 estimates. Statment III. The number of estimates needed under the Markowitz portfolio optimization approach exceed the number of estimates needed under the single-index model approach by 15,048.

Which of the following is correct?