You Are Comparing the Returns of Two Portfolios for a 10-Year

question 34

Multiple Choice

You are comparing the returns of two portfolios for a 10-year period.Portfolio I has a lower dispersion of returns and a higher average rate of return than Portfolio II.Given this,what do you know with certainty?

• A)Portfolio I has a lower standard deviation than Portfolio II.
• B)Portfolio I is riskier than Portfolio II.
• C)Portfolio II has less total risk than Portfolio I.
• D)Portfolio I will outperform Portfolio II over the next 10 years.
• E)Portfolio II consists of more individual stocks than Portfolio I.

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