Which of the Following Is Not True Regarding Currency Correlations

question 36

Multiple Choice

Which of the following is not true regarding currency correlations?

• A) Two highly positively correlated currencies act almost as if they are the same currency.
• B) If two inflow currencies are highly positively correlated, transaction exposure is somewhat offset.
• C) If two inflow currencies are negatively correlated, transaction exposure is somewhat offset.
• D) If two currencies, one an inflow currency and the other an outflow currency, are highly positively correlated, transaction exposure is somewhat offset.

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