Consider an Equally Weighted Portfolio That Contains 20 Stocks

question 99

Multiple Choice

Consider an equally weighted portfolio that contains 20 stocks.If the average volatility of these stocks is 35% and the average correlation between the stocks is .4,then the volatility of this equally weighted portfolio is closest to:

• A).17.
• B).41.
• C).14.
• D).37.

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Definitions:

Work Process

The sequence of activities or steps taken to achieve a particular end in a business environment.

Work Process

A sequence of tasks or activities that are carried out to achieve a particular outcome, often related to producing goods or providing services.

Related Group

A set of individuals or entities connected by common interests, goals, or characteristics, often used in the context of organizational departments or familial relations.

Create Value

The process of producing goods or services that have greater worth than the cost of inputs, resulting in a beneficial outcome for businesses or consumers.