In General,which Stocks Should Be Combined into a Portfolio If

question 59

Multiple Choice

In general,which stocks should be combined into a portfolio if the goal is the greatest reduction possible in overall portfolio risk?

• A) Stocks with returns that are positively correlated
• B) Stocks with returns that are not correlated
• C) Stocks with returns that have the highest specific risk
• D) Stocks that have the highest expected returns

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Definitions:

Amino Acid

Organic compounds that serve as the building blocks of proteins, containing both amino (-NH2) and carboxylic acid (-COOH) functional groups.

Polypeptide

A molecule consisting of a chain of amino acids linked by peptide bonds, and is the building block of proteins.

Amino Acid Sequences

The order in which amino acids are linked together by peptide bonds in a protein or peptide.

Enzyme

Biological catalysts which accelerate chemical reactions in living organisms by lowering the activation energy.