Combining Assets with Highly Correlated Returns Will Greatly Reduce Portfolio

question 41

True/False

Combining assets with highly correlated returns will greatly reduce portfolio risk.
Just the opposite: Negative correlation spreads risk more effectively.

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Definitions:

Character Theories

A set of ideas that attempt to explain differences in individuals' moral qualities and behaviors.

Cultural Relativism

The belief that one should comprehend a person's values and behaviors through the lens of their unique cultural background.

Distributive Justice

The perceived fairness of the allocation of resources or rewards among individuals within an organization or group.

Procedural Justice

The concept concerned with the fairness and the transparency of the processes by which decisions are made.