The ________ the Returns on Two Securities Move Together,the ________

question 3

Multiple Choice

The ________ the returns on two securities move together,the ________ benefit there is from diversification.

• A)less;more
• B)less;less
• C)more;more
• D)more;greater

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Definitions:

Trading (Debt) Securities

Financial instruments, such as bonds or notes, that are bought and sold with the intention of making a profit from short-term price fluctuations.

Historical Cost

The original monetary value of an asset or expense as recorded at the time of purchase or acquisition.

Fair Value

An estimate of the price at which an asset would trade in a competitive auction setting.

Long-Term Investments

Assets that a company intends to hold for more than one fiscal year, such as stocks, bonds, real estate, or investments in other companies.