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Which of the following statements is INCORRECT? The coefficient of variation is a better measure of risk than the standard deviation if the expected returns
Which of the following statements is INCORRECT?
The coefficient of variation is a better measure of risk than the standard deviation if the expected returns of the securities being compared differ significantly.
The higher the correlation between the stocks in a portfolio, the higher the risk inherent in the portfolio.
If you add enough randomly selected stocks to a portfolio, you can completely. eliminate all of the market risk from the portfolio.
For a portfolio consisting of two securities when returns from the two securities are perfectly negatively correlated that is correlation coefficient is equal to negative one thert will always be some proportion of the securities that will result in the complete elimination of portfolio risk.
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