Answered step by step
Verified Expert Solution
Question
1 Approved Answer
please answer true or false 0 0 7. In a large portfolio, the standard deviation is equal to the sum of the weighted covariances. 0
please answer true or false
0 0 7. In a large portfolio, the standard deviation is equal to the sum of the weighted covariances. 0 0 8. If the covariance between two assets equals zero, their correlation on must be zero. 0 0 9. If the correlation between two assets equals zero, the portfolio's standard deviation is a weighted average of the assets standard deviations. 0 0 10. It is fair to assume that a negative correlation between two assets produces a portfolio standard deviation equal to zero. 0 0 11. The expected return on an asset with a probability of 20% to gain 16% and an 80% probability of losing 2% is greater than 1.5%. OO 12. The expected return on a portfolio weighted 80% by a stock with an expected return of 10% and 20% by a stock with an expected return of -10% is less than 5%. 0 0 13. It is not possible for a 2-stock portfolio to have lower risk than either single stock. 0 0 14. If two equally-weighted assets have standard deviations of 30% and a covariance of 300%, the portfolio's standard deviation is less than 22%. 0 0 7. In a large portfolio, the standard deviation is equal to the sum of the weighted covariances. 0 0 8. If the covariance between two assets equals zero, their correlation on must be zero. 0 0 9. If the correlation between two assets equals zero, the portfolio's standard deviation is a weighted average of the assets standard deviations. 0 0 10. It is fair to assume that a negative correlation between two assets produces a portfolio standard deviation equal to zero. 0 0 11. The expected return on an asset with a probability of 20% to gain 16% and an 80% probability of losing 2% is greater than 1.5%. OO 12. The expected return on a portfolio weighted 80% by a stock with an expected return of 10% and 20% by a stock with an expected return of -10% is less than 5%. 0 0 13. It is not possible for a 2-stock portfolio to have lower risk than either single stock. 0 0 14. If two equally-weighted assets have standard deviations of 30% and a covariance of 300%, the portfolio's standard deviation is less than 22%Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started