The Variance of a Portfolio of Two Investments Will Be

question 39

True/False

The variance of a portfolio of two investments will be equal to the sum of the variances of the two investments plus twice the covariance between the investments.

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Definitions:

Horizontal Division

Involves the separation of tasks within an organization based on specific functions or roles, promoting specialization.

Key Themes

Central topics or issues that are of utmost importance within a specific context or area of study.

Differentiation

Differentiation is a strategy or process in which a business distinguishes its product or service from that of its competitors, typically through quality, design, or features.

Division of Labour

The process of splitting work into distinct tasks, each performed by different workers or groups of workers, to improve efficiency.