The Standard Deviation of Returns on Warchester Stock Is 20

question 52

True/False

The standard deviation of returns on Warchester stock is 20% and on Shoesbury stock it is 16%. The coefficient of correlation between the stocks is .75. The standard deviation of any portfolio combining the two stocks will be less than 20%.

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Smoking

The process of breathing in and out smoke from ignited tobacco or other materials, frequently linked to various health hazards.

Peer Pressure

The influence exerted by a peer group in encouraging a person to change their attitudes, values, or behavior in order to conform to group norms.

Tobacco

A product prepared from the leaves of the tobacco plant, commonly used for smoking, chewing, or snuff.

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The impact that family members have on an individual’s development, behavior, and life choices.