Which of the Following Statements Is FALSE

question 121

Multiple Choice

Which of the following statements is FALSE?

• A)Stock returns will tend to move together if they are affected similarly by economic events.
• B)Stocks in the same industry tend to have more highly correlated returns than stocks in different industries.
• C)Almost all of the correlations between stocks are negative,illustrating the general tendency of stocks to move together.
• D)With a positive amount invested in each stock,the more the stocks move together and the higher their covariance or correlation,the more variable the portfolio will be.

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