Question: True/False/Uncertain Please explain your reasoning-just a sentence or two are fine. There is a very volatile security which pays you a positive return when the
True/False/Uncertain
Please explain your reasoning-just a sentence or two are fine.
There is a very volatile security which pays you a positive return when the market performs poorly and a negative return when the market performs well. The expected return on this asset is 2%, which is equal to the risk-free rate. It would never be optimal to include this asset in a rational mean-variance investor's portfolio.
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