Question: finance question QUESTION 2 When two risky securities that are positively correlated but not perfectly correlated are held in a portfolio, the portfolio standard deviation

finance question

QUESTION 2 When two risky securities that are positively correlated but not perfectly correlated are held in a portfolio, the portfolio standard deviation is always equal to the securities' covariance. OA the portfolio standard deviation is less than the weighted average of the individual security standard deviations. O B None of the options OC the portfolio standard deviation is greater than the weighted average of the individual security standard D. deviations . the portfolio standard deviation is equal to the weighted average of the individual secur ndard deviations. OE

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

1) Security X has expected return of 12% and standard deviation of 20%. Security Y has expected return of 15% and standard deviation of 27%. If the two securities have a correlation coefficient of...

ii) Shock 27 Shick 2 Ei) Sucek i i lorposeible to know withod more infortastiots 10. Ler's assume you are stadyinat a porffolio shat consists of two rishy ascts. Do you 1) Stack i : Stock: need ro...

23. The efficient frontier of risky assets is A. the portion of the investment opportunity set that lies above the global minimum variance portfolio. B. the portion of the investment opportunity set...

answe all 23. The efficient frontier of risky assets is A the portion of the investment opportunity set that lies above the global minimum variance portfolio. B. the portion of the investment...

When two risky securities that are positively correlated but not perfectly correlated are held in a portfolio, Group of answer choices the portfolio standard deviation will be greater than the...

When two risky securities that are positively correlated but not perfectly correlated are held in a portfolio, A. the portfolio standard deviation is always equal to the securities' covariance. B....

When two risky securities that are positively correlated but not perfectly correlated are held in a portfolio, A.the portfolio standard deviation is always equal to the securities' covariance. B.the...

When two risky securities that are positively correlated but not perfectly correlated are held in a portfolio, A ) the portfolio standard deviation will be greater than the weighted average of the...

When two risky securities that are positively correlated but not perfectly correlated are held in a portfolio, A. the portfolio standard deviation is always equal to the securities' covariance. B....

20. When two risky securities that are positively (but not perfectly) correlated are held in a portfolio Question 9 Select one: a. The portfolio standard deviation will be greater than the weighted...

Ryan Company furnished the condensed data shown in Exhibit. 1. Prepare a trend analysis for Ryans income statements and balance sheets that compares 20X3 with 20X2. Your analysis should show both the...

Given the following voltage and current determine the phase relationship between i(t) and v(t). i(t) = 5 sin (377t 20) V v(t) = 10 cos (377t + 30) V

Which part of the award package includes the Commitment ID number, Vendor ID, and accounting data for the federal award? A. The Award Letter B. The Agreement Articles C. The Notification e-mail D....

True or False. Match types stop your ad from being shown to people who are likely to become your customers. True False True or False. Branded keywords are useful for potential customers who already...

Sensitivity analysis, changing budget assumptions, and Kaizen approach. Two brands of chocolate chip cookies, Chippo and Choco, each using two ingredients, are produced by the Choco Chips...

Comprehensive problem with ABC costing. Pet Transport Company makes two pet carriers, the Cat-allac and the Dog-eriffic. They are both made of plastic with metal doors, coon 2. Production units:...

Cash budget. (Continuation of 6-36) Assume the following: Pet Transport (PT) does not make any sales on credit. PT sells only to the public, and accepts cash and credit cards. Of its sales, 90% are...