Use the Table for the Question(s) Below

question 14

Essay

Use the table for the question(s) below.
Consider the following expected returns, volatilities, and correlations:

-What diversification, if any, is achieved if two stocks in a portfolio are perfectly positively correlated?

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Definitions:

Major Histocompatibility Complex

Major Histocompatibility Complex is a set of genes that code for proteins on the cell surface, which help the immune system recognize foreign substances.

Dendritic Cells

Immune cells that process antigen material and present it on their surface to T-cells, initiating an immune response.

Macrophages

Macrophages are essential cells within the immune system, responsible for detecting, engulfing, and destroying pathogens and dead cells through the process of phagocytosis.

Mucosa

A moist tissue layer lining certain internal cavities of the body, including the gut and respiratory passages, involved in absorption and secretion.