Question: 1. When there are only two assets being considered for a portfolio, which of the following statements is correct? a. A correlation coefficient of 0

1. When there are only two assets being considered for a portfolio, which of the following statements is correct?

a. A correlation coefficient of 0 offers no risk reduction opportunity

b. When the correlation coefficient is -1, the minimum variance portfolio has 0 variance

c. The lower the correlation coefficient, the less risk reduction potential

d. The higher the correlation coefficient between the returns of the two assets, the more risk reduction potential

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