Assets Whose Returns Have a High Positive Correlation Are Considered

question 43

Multiple Choice

Assets whose returns have a high positive correlation are considered:

• A)highly risky compared with those whose returns have lower or negative correlations..
• B)completely risk free.
• C)less risky compared to those which have a low positive correlation.
• D)partially risky.

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Definitions:

Assets

Economic resources or owned items of value, including cash, property, and investments, that an individual or company can utilize to cover liabilities.

Dividend Yield

The ratio of a company's annual dividend payments to its share price, indicating the earnings investors can expect from owning the stock.

Liabilities

Financial obligations or debts that a company owes to others, which must be repaid.

Closed-end Investment

An investment fund that has a fixed number of shares outstanding, typically traded on a stock exchange, unlike open-end funds that can issue unlimited shares.