Which One of the Following Correlation Coefficients Must Apply to Two

question 4

Multiple Choice

Which one of the following correlation coefficients must apply to two assets if the equally weighted portfolio of those assets creates a minimum variance portfolio that has a standard deviation of zero?

• A) -1.0
• B) -0.5
• C) 0.0
• D) 0.5
• E) 1.0

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Definitions:

Frequency

Refers to the rate at which a repeating event occurs, such as the number of occurrences of a particular event within a set period of time.

Musical Note

A symbol representing a musical sound with a specific pitch and duration.

Olfactory Bulb

A brain structure above the olfactory epithelium in the nasal cavity; from this structure, the olfactory nerve carries information about smell to the brain.

Odorants

Odorants are chemicals that are capable of eliciting a physiological response that is detected by the sense of smell.