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Which of the following statements are true about correlation and diversification? 1. Any two securities with less than perfect positive correlation will improve the diversification

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Which of the following statements are true about correlation and diversification? 1. Any two securities with less than perfect positive correlation will improve the diversification of a portfolio. 2. Adding an asset with a correlation of .5 to a portfolio will be more beneficial than an asset with a correlation of .5. 3. Adding an asset with a correlation of 1 will be more beneficial than an asset with a correlation of 0 . 4. Adding an asset with a correlation of .5 will be more beneficial than an asset with a correlation of 0 . 1 only 1,2 and 3 only 1 and 2 only 1,2,3 and 4 2 and 4 only

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