Assume that every asset has the same expected return and variance. Furthermore, all assets have the same
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Assume that every asset has the same expected return and variance.
Furthermore, all assets have the same covariance with each other. As the number of assets in the portfolio grows, which becomes more important: variance or covariance? Clarify your answer using words, diagrams, formulae or a practical example.
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Related Book For
Corporate Finance
ISBN: 9780077173630
3rd Edition
Authors: David Hillier, Stephen A. Ross, Randolph W. Westerfield, Bradford D. Jordan, Jeffrey F. Jaffe
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