What Is the Correlation Coefficient for Two Assets with a Covariance

question 2

Multiple Choice

What is the correlation coefficient for two assets with a covariance of .0032, if asset 1 has a standard deviation of 12 percent and asset 2 has a standard deviation of 9 percent?

• A) 0.2963
• B) 0.3456
• C) 0.8721
• D) 1.5980

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Definitions:

Capitalizing on Strengths

The strategy of identifying and utilizing an individual's or organization's strongest skills and attributes to achieve success and improvement.

Alignment

The process of adjusting various elements or strategies within an organization so that they are coordinated and support the overall objectives.

Participative Decision Making

A leadership style where employees at all levels are encouraged to contribute ideas and opinions towards making decisions that affect their work and the organization.

Emotional Support

Emotional support entails offering empathy, concern, encouragement, and love to someone, helping them cope with stress and emotional challenges.