Consider an Equally Weighted Portfolio That Contains 100 Stocks

question 18

Multiple Choice

Consider an equally weighted portfolio that contains 100 stocks.If the average volatility of these stocks is 50% and the average correlation between the stocks is .7,then the volatility of this equally weighted portfolio is closest to:

• A).72.
• B).63.
• C).40.
• D).50.

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Definitions:

Lifestyle

The way in which a person or group lives, including patterns of social relations, consumption, entertainment, and dress.

Environment

The sum of all external conditions and influences affecting the life and development of an organism, including natural and built settings.

Ethnicity

A social group's shared cultural practices, perspectives, and distinctions that set it apart from others.

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A sleep disorder characterized by pauses in breathing or shallow breaths due to throat muscles intermittently relaxing and blocking the airway.