How Does M1+ Compare with M2

question 145

Multiple Choice

How does M1+ compare with M2?

• A) M1+ is smaller and less liquid than M2.
• B) M1+ is smaller but more liquid than M2.
• C) M1+ is larger than and less liquid than M2.
• D) M1+ is larger than but more liquid than M2.

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Definitions:

Expected Return

The average return anticipated on an investment over a given period, accounting for the different rates of return and their probabilities.

Portfolio Variance

A measure of the dispersion of the returns of a portfolio, indicating the level of risk involved.

Correlation Coefficient

A numerical indicator that shows the extent of association between two variables' movements.

Standard Deviation

A statistical measure that quantifies the dispersion or spread of a set of data points or investment returns around their mean.