In a Portfolio of Three Randomly Selected Stocks,which of the Following

question 138

Multiple Choice

In a portfolio of three randomly selected stocks,which of the following could NOT be true,i.e.,which statement is false?

• A)The riskiness of the portfolio is less than the riskiness of each of the stocks if they were held in isolation.
• B)The riskiness of the portfolio is greater than the riskiness of one or two of the stocks.
• C)The beta of the portfolio is lower than the lowest of the three betas.
• D)The beta of the portfolio is higher than the highest of the three betas.
• E)The beta of the portfolio is calculated as a weighted average of the individual stocks' betas.

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Definitions:

Cleft Palate

A congenital deformity characterized by an opening or split in the roof of the mouth.

Black, Hairy Tongue

A benign condition characterized by a darkened, hair-like appearance on the tongue's surface, usually due to poor oral hygiene, tobacco use, or certain medications.

Fungal Infection

A condition caused by the growth of fungus in or on the body, often leading to various symptoms like itching or rash.

Sucking Tubercle

A small, rounded projection on the lips of an infant, developed from frequent sucking.