Question
Consider the characteristics of the following three stocks: Expected Return Standard Deviation Thumb Devices 13% 23% Air Comfort 13% 19% Sport Garb 10% 17% The
Consider the characteristics of the following three stocks:
| ExpectedReturn | Standard Deviation |
Thumb Devices | 13% | 23% |
Air Comfort | 13% | 19% |
Sport Garb | 10% | 17% |
The correlation coefficients among the three stocks returns are given in the following table:
Correlation Coefficients | |||
| Thumb Devices | Air Comfort | Sport Garb |
Thumb Devices | 1 |
|
|
Air Comfort | 0.35 | 1 |
|
Sport Garb | -0.12 | -0.25 | 1 |
If you can pick only two stocks for your portfolio, which would you pick?
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Handbook Of Short Selling
Authors: Greg N. Gregoriou
1st Edition
0123877245, 978-0123877246
