321.
415.2
2.Circle any and/or all that are true:
When you put two positively correlated stocks
together in a portfolio,
- you get a portfolio whose risk is the
weighted average of the risks of the individual stocks.
- you can end up with portfolio standard
deviation that is less than the lower of the two
individual stock standard deviations.
- you have not achieved any diversification.
- you increase your risk due to the positive
correlation.
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