Which of the Following Is Most Likely to Be True

question 68

Multiple Choice

Which of the following is most likely to be true for a portfolio of 40 randomly selected stocks?

• A) The riskiness of the portfolio is the same as the riskiness of each stock if it was held in isolation.
• B) The beta of the portfolio is less than the average of the betas of the individual stocks.
• C) The beta of the portfolio is equal to the average of the betas of the individual stocks.
• D) The beta of the portfolio is larger than the average of the betas of the individual stocks.
• E) The riskiness of the portfolio is greater than the riskiness of each of the stocks if each was held in isolation.

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Definitions:

Java Coordinate System

The coordinate system used in Java's AWT and Swing for graphical user interface (GUI) programming, which starts with (0,0) at the upper left corner.

Scroll Pane

A graphical component that provides a scrollable view of another component or elements within a defined area.

ProductDescription

A detailed explanation or account of a product's features and benefits, typically used in marketing to inform potential buyers.

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A class in Java's AWT (Abstract Window Toolkit) package that encapsulates colors in the default sRGB color space.