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For the next two questions (37-38), ASSUME that the one year returns for COMPANY A are still {25%, -15%, 120%, -30%, -45%}. Assume also that

For the next two questions (37-38), ASSUME that the one year returns for COMPANY A are still {25%, -15%, 120%, -30%, -45%}. Assume also that you acquired shares in COMPANY B, which has had annual returns over the same period, of:

{27; 35%; -10%; 10%; -15%}.

What is the correlation between the returns on COMPANY A and COMPANY B shares?

Multiple Choice 0.278 - 0.204 0.567 - 0.356

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