Question: If the correlation between two stocks is 0.8, then a portfolio combining these two stocks in equal proportions will have a variance that is? Group

If the correlation between two stocks is 0.8, then a portfolio combining these two stocks in equal proportions will have a variance that is?

Group of answer choices

a. less than the weighted average of the two individual variances.

b. equal to the weighted average of the two individual variances.

c. Cannot be determined

d. greater than the weighted average of the two individual variances.

e. less than or equal to average variance of the two weighted variances, depending on other information.

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