Use the following three statements to answer this question: Which ones are correct? Which ones are incorrect?
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Question:
Use the following three statements to answer this question: Which ones are correct? Which ones are incorrect?
I. There will be benefits from diversification as long aspAB< +1.
II. As long aspAB= -1, an equally weighted portfolio would be risk-free.
III. Diversification can never eliminate the total risk of the portfolio.
a) I is correct, II is incorrect, III is correct.
b) I is incorrect, II is correct, III is correct.
c) I and II are correct, III is incorrect.
d) I, II and III are incorrect.
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