Even If the Correlation Between the Returns on Two Different

question 36

True/False

Even if the correlation between the returns on two different securities is perfectly positive, if the securities are combined in the correct unequal proportions, the resulting portfolio can have less risk than either security held alone.

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Definitions:

Pain

A complex experience involving sensory and emotional components, resulting from actual or potential tissue damage.

Chronic

Describing a health condition or disease that is persistent or otherwise long-lasting in its effects.

Pitch Perception

The auditory sensation that allows individuals to distinguish between high and low sounds based on their frequency.

Colour Vision

The capacity of the visual system to differentiate between objects by identifying the wavelengths of light they reflect, emit, or pass through.