In a Two Stock Portfolio,if the Correlation Coefficient Between Two

question 74

Multiple Choice

In a two stock portfolio,if the correlation coefficient between two stocks were to decrease over time,everything else remaining constant,the portfolio's risk would

• A) Decrease.
• B) Remain constant.
• C) Increase.
• D) Fluctuate positively and negatively.
• E) Be a negative value.

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Definitions:

Vocalis

The muscle located within the vocal folds that adjusts tension, playing a key role in producing speech sounds by controlling pitch and tone.

Masseter

A facial muscle that plays a major role in the chewing process by elevating the mandible (jawbone).

Zygomaticus Major

A facial muscle that draws the angle of the mouth upward and outward, primarily involved in smiling.

Crow's Feet

Fine lines or wrinkles that form around the outer corners of the eyes, often associated with aging or frequent exposure to sunlight.