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Suppose that the average stock has a volatility of 46 % and that the correlation between pairs of stocks is 24 % Estimate the volatility

Suppose that the average stock has a volatility of 46 % and that the correlation between pairs of stocks is 24 %

Estimate the volatility of an equally weighted portfolio with:

a.

1 stock

b.

30 stocks

c.

1,000 stocks

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