Which of These Represents a Perfect Correlation

question 35

Multiple Choice

Which of these represents a perfect correlation?

• A) -1.00 only
• B) 1.00 only
• C) 0
• D) -1.00 or 1.00

---

Definitions:

Risk-Free Rate

The theoretical rate of return of an investment with no risk of financial loss.

Portfolio Beta

Portfolio Beta is a measure of the overall systematic risk of a portfolio of investments relative to the market as a whole.

Exchange-Traded Fund

An Exchange-Traded Fund (ETF) is a type of investment fund and exchange-traded product, the shares of which are traded on stock exchanges.

Market Beta

A measure of a stock's volatility in relation to the market; a beta greater than 1 indicates higher volatility than the market.