D Question 7 8 pts The Waverley Foundation, a United States-based, not-for-profit charitable organisation, has a diversified investment portfolio of $500 million. Waverley's board of directors is considering an initial investment in emerging market equities. Charles Hooper, treasurer of the foundation, has made the following remarks: A. "For an investor holding only developed market equities, the existence of stable emerging market currencies is one of several preconditions necessary for that investor to realise strong emerging market performance." B. "Local currency depreciation against the dollar has been a frequent occurrence for United States investors in emerging markets. United States investors have consistently seen large percentages of their returns erased by currency depreciation. This is true even for long-term investors." in emerging markets. United States investors have consistently seen large percentages of their returns erased by currency depreciation. This is true even for long-term investors." C. "Historically, the addition of emerging market stocks to a United States equity portfolio such as the S&P 500 index has reduced volatility; volatility has also been reduced when emerging market stocks are combined with an international portfolio such as the MSCI EAFE index." D. "Although correlations among emerging markets can change over the short term, such correlations show evidence of stability over the long term. Thus, an emerging markets portfolio that lies on the efficient frontier in one period tends to remain close to the frontier in subsequent periods." Discuss whether each of Hooper's four comments is correct or incorrect. Edit View Insert Format Tools Table 12pt v Paragraph v BI U 30 1