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The following figure shows plots of monthly rates of return and the stock market for two stocks. a. Which stock is riskier to an investor

The following figure shows plots of monthly rates of return and the stock market for two stocks.

image text in transcribed

a. Which stock is riskier to an investor currently holding a diversified portfolio of common stock?

Stock A
Stock B

b. Which stock is riskier to an undiversified investor who puts all of his funds in only one of these stocks?

Stock A
Stock B

A-7 B- -rm-1 * . 'M-P

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