In a Portfolio of Three Different Stocks, Which of the Following

question 29

Multiple Choice

In a portfolio of three different stocks, which of the following could NOT be true?

• 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 less than the betas of each of the individual stocks.
• D) The beta of the portfolio is greater than the beta of one or two of the individual stocks' betas.