Portfolio a of a Collection of Stocks Is Considered More

question 105

Multiple Choice

Portfolio A of a collection of stocks is considered more risky than portfolio B if:

• A) portfolio A has a higher mean than portfolio B.
• B) portfolio A has a higher variance than portfolio B.
• C) portfolio A has a higher standard deviation.
• D) portfolio A has a higher coefficient of variation than portfolio B.

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Definitions:

Hong Kong Dollars

The legal currency of Hong Kong, used in financial transactions within the region.

U.S. Dollars

The official currency of the United States, widely used as a benchmark in global financial transactions.

Uncovered Interest Rate Parity

A theory suggesting that the difference in interest rates between two countries is equal to the expected change in exchange rates between those countries' currencies.

Nominal Risk-Free Return

The return on an investment with zero risk in nominal terms, not adjusting for inflation.