The Volatility of Woolworth's Share Price Is 30% and That

question 53

Multiple Choice

The volatility of Woolworth's share price is 30% and that of Reckon's shares is 30%. When I hold both shares in my portfolio and the returns have a correlation of 1, the overall volatility of returns of the portfolio is

• A) more than 30%.
• B) unchanged at 30%.
• C) less than 30%.
• D) Cannot say for sure

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Definitions:

Different Users

Various individuals or groups that use or interact with a product, service, or system, each with distinct needs and preferences.

Different Locations

Refers to various places or positions, sometimes indicating the presence of objects or activities in multiple areas.

Double-Entry Bookkeeping System

An accounting method that records each transaction in two accounts, debit and credit, to ensure financial records balance.

Single-Entry System

An accounting method where each transaction is recorded with a single entry to the accounting records, not providing a complete picture of financial transactions.