Which of the Following Statements Is CORRECT

question 65

Multiple Choice

Which of the following statements is CORRECT?

• A) A two-stock portfolio will always have a lower standard deviation than a one-stock portfolio.
• B) A portfolio that consists of 40 stocks that are not highly correlated with "the market" will probably be less risky than a portfolio of 40 stocks that are highly correlated with the market,assuming the stocks all have the same standard deviations.
• C) A two-stock portfolio will always have a lower beta than a one-stock portfolio.
• D) If portfolios are formed by randomly selecting stocks,a 10-stock portfolio will always have a lower beta than a one-stock portfolio.
• E) A stock with an above-average standard deviation must also have an above-average beta.

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Definitions:

Social Structural Barriers

Obstacles that exist within a society's organization, norms, and institutions, which prevent individuals or groups from achieving equal status, opportunities, or resources.

Assimilation

The process by which individuals or groups adopt the culture, norms, and practices of another group, losing their original identity.

Devaluation of Credentials

The diminishing value of educational or professional qualifications due to oversupply or changes in job market demand.

Canadian Doctor

A medical professional licensed to practice medicine within Canada, often involved in providing healthcare and treatment to patients.