Question: True or False 1-4 In a two-stock portfolio, the two stocks must be perfectly positively correlated in order to diversify away some risk. True False

True or False 1-4

In a two-stock portfolio, the two stocks must be perfectly positively correlated in order to diversify away some risk. True False 2 You can create a riskless two-stock portfolio if you have two stocks that are perfectly negatively correlated. True False 3 Beta is a measure of firm-specific risk. True False In a well-diversified portfolio with many securities, all risk will be diversified away so that the portfolio standard deviation will be zero. True False

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