If You Are Considering Investing in German Stocks as a Means

question 66

Multiple Choice

If you are considering investing in German stocks as a means to reduce the risk of your portfolio, the initial factor that you should examine is:

• A) The average rate of return of the portfolio when you combine Canadian and German stocks.
• B) The standard deviation of the German stocks.
• C) The standard deviation of the German stocks compared to the standard deviation of Canadian stocks.
• D) The correlation between the rates of return for German stocks and Canadian stocks.
• E) The coefficient of variation (CV) of rates of return for German stocks versus the CV of rates of return for Canadian stocks.

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