Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

What can be concluded when the correlation coefficient of two companies = -0.95? Select one: a. The variances of the two companies are approximately equal

What can be concluded when the correlation coefficient of two companies = -0.95?

Select one: a. The variances of the two companies are approximately equal to each other b. The expected returns of the two companies are exactly opposite of each other c. The two companies are in similar or the exact same industries d. The covariance between the returns of the two companies is less than zero e. The state dependent returns of the two companies are approximately equal

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Contemporary Financial Management

Authors: R. Charles Moyer, James R. McGuigan, William J. Kretlow

11th Edition

0324653506, 978-0324653502

More Books

Students also viewed these Finance questions