The data in the accompanying table represent the annual rates of return for various stocks. If you only wish to invest in two stocks, which two would you select if your goal is to have low correlation between the two investments? Which two would you select if your goal is to have one stock go up when the other goes down?

Year	Stock A	Stock B	Stock C	Stock D	Stock E	Stock F
1	0.113	0.523	0.031	0.126	0.112	0.131
2	0.129	0.050	1.482	0.554	0.557	0.553
3	0.164	0.138	0.206	0.169	0.164	0.171
4	0.073	0.343	0.072	0.066	0.139	0.042
5	0.020	0.281	0.016	0.095	0.002	0.126
6	0.061	0.540	0.142	0.112	0.191	0.086
7	0.102	0.093	0.098	0.098	0.103	0.096
8	0.006	0.048	0.050	0.035	0.037	0.059
9	0.089	0.012	0.164	0.08	0.176	0.048
10	0.100	0.197	0.089	0.003	0.032	0.015
11	0.314	0.344	0.248	0.073	0.078	0.071

If your goal is to have low correlation between the two investments, you should select

Stock B and Stock C,

Stock C and Stock D,

Stock E and Stock F,

Stock A and Stock D,

Stock C and Stock E,

Stock A and Stock C,

Stock B and Stock E,

Stock B and Stock F,

Stock C and Stock F,

Stock A and Stock F,

Stock A and Stock B,

Stock D and Stock F,

Stock D and Stock E,

Stock A and Stock E,

Stock B and Stock D,

since the linear correlation coefficient for these two stocks

is closest to minus 1.is closest to 1.

is closest to plus 1.is closest to +1.

is closest to 0.

If your goal is to have one stock go up when the other goes down, you should select

Stock B and Stock E,

Stock A and Stock B,

Stock A and Stock D,

Stock E and Stock F,

Stock D and Stock E,

Stock A and Stock E,

Stock B and Stock C,

Stock D and Stock F,

Stock C and Stock D,

Stock B and Stock D,

Stock A and Stock C,

Stock C and Stock F,

Stock A and Stock F,

Stock C and Stock E,

Stock B and Stock F,

since the linear correlation coefficient for these two stocks

is closest to plus 1.is closest to +1.

is closest to minus 1.is closest to 1.

is closest to 0.