In Order to Benefit from Diversification, the Returns on Assets

question 83

Multiple Choice

In order to benefit from diversification, the returns on assets in a portfolio must:

• A)Be perfectly positively correlated
• B)Be perfectly negatively correlated
• C)Not be perfectly positively correlated
• D)Have the same idiosyncratic risks

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Definitions:

Eu-

A prefix meaning good, well, advantageous, or normal in the context of medical terminology.

Hypo-

Prefix indicating low, under, beneath, down, or less than normal.

Mega-

A prefix in medical terminology indicating enlargement or one million units.

Sym-

A prefix in medical terms denoting "together" or "with," used to describe conditions that involve multiple factors or elements acting together.