Question: Use the table for the question(s) below. Consider the following expected returns, volatilities, and correlations: Expected Standard Correlation with Correlation with Correlation with Stock Retum

 Use the table for the question(s) below. Consider the following expected

Use the table for the question(s) below. Consider the following expected returns, volatilities, and correlations: Expected Standard Correlation with Correlation with Correlation with Stock Retum Deviation Duke Energy Microsoft Wal-Mart Duke Energy 14% 6% 1.0 -1.0 0.0 Microsoft 24% -10 1.0 0.7 Wal-Mart 23% 14% 00 0.7 1.0 Which of the following combinations of two stocks would give you the biggest reduction in risk? O A. Wal-Mart and Microsoft OB. Microsoft and Duke Energy OC. Duke Energy and Wal-Mart OD. No combination wil reduce risk

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