Which of the Following Statements Is FALSE

question 127

Multiple Choice

Which of the following statements is FALSE?

• A)The Sharpe ratio of the portfolio tells us how much our expected return will increase for a given increase in volatility.
• B)We should continue to trade securities until the expected return of each security equals its required return.
• C)The required return is the expected return that is necessary to compensate for the risk that an investment will contribute to the portfolio.
• D)If security i's required return exceeds its expected return,then adding more of it will improve the performance of the portfolio.

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