Question
Question 14 Which of the following is incorrect? a. Add stocks with perfect correlation with each other will reduce the portfolio risk b. Combining 2
Question 14
Which of the following is incorrect?
| a. Add stocks with perfect correlation with each other will reduce the portfolio risk | ||
| b. Combining 2 stocks that has a negative correlation with each other in a portfolio will reduce the portfolio risk. | ||
| c. Combining 2 stocks that has a correlation of coefficient of 0.5 in a portfolio will reduce the portfolio risk. | ||
| d. Add a stock that has the perfect correlation with the existing portfolio with each other will not reduce risk |
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Financial and Managerial Accounting
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
2nd edition
978-1118334263
