Which of the following statements is FALSE? The volatility of the portfolio will differ, depending on the correlation between the securities in the portfolio. In finance, the standard deviation of a return is also referred to as its volatility. A short sale is a transaction in which you sell a stock that you do not own and then agree to buy that stock back in the future. The covariance and correlation allow us to measure the co-movement of returns. The closer the correlation is to 0, the more the returns tend to move together as a result of common risk