Multiple Choice
Combining two stocks to form a portfolio offers maximum diversification benefits when _____.
A) the stocks have a correlation coefficient equal to 0
B) the stocks have a correlation coefficient equal to +1
C) the stocks have a correlation coefficient equal to -1
D) the both stocks have a coefficients of variation of 0
E) both stocks have a coefficients of variation of -1
Correct Answer:
Verified
Correct Answer:
Verified
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