The Variance of a Portfolio of Two Investments Will Be

question 192

True/False

The variance of a portfolio of two investments will be equal to the sum of the variances of the two investments when the covariance between the investments is zero.

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Definitions:

Valid Argument

A logical conclusion based on premises that are true and follows a form that guarantees its truth.

Educated Mind

A mind that has acquired knowledge and intellectual skills through learning and study.

Aristotle

An ancient Greek philosopher and polymath, whose writings covered a wide range of subjects and significantly influenced Western philosophy and science.

Premises Imply

The logical process where a set of stated propositions (premises) are shown to necessarily lead to a specific conclusion.