If the Correlation Between Two Stocks Is -1,the Returns

question 105

Multiple Choice

If the correlation between two stocks is -1,the returns:

• A)generally move in the same direction.
• B)are unrelated to one another as it is < 0.
• C)move perfectly opposite one another.
• D)have standard deviations of equal size but opposite signs.
• E)None of the above.

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Definitions:

Repetition

The act or process of doing or saying something again, often for emphasis or to ensure understanding.

Perceptual Process

The sequence of steps that involves receiving, selecting, organizing, interpreting, and responding to sensory information.

Private-label Item

A product that is manufactured by one company but sold under another company's brand, typically a retailer's brand.

Branded Item

A product or service that is marketed under a particular brand name, recognized for its quality, design, or performance.