The Diversification Effect of a Portfolio of Two Stocks

question 84

Multiple Choice

The diversification effect of a portfolio of two stocks:

• A)increases as the correlation between the stocks declines.
• B)increases as the correlation between the stocks rises.
• C)decreases as the correlation between the stocks rises.
• D)Both A and C.
• E)None of the above.

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Definitions:

Medical Research

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The Plague

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