Multiple Choice
The standard deviation of a portfolio will tend to increase when
A) the portfolio concentration in a single cyclical industry increases.
B) one of two stocks related to the airline industry is replaced with a third stock that is unrelated to any other stock in the portfolio.
C) a risky asset in the portfolio is replaced with U.S.Treasury bills.
D) the weights of the various diverse securities become more evenly distributed.
E) short-term bonds are replaced with Treasury Bills.
Correct Answer:
Verified
Correct Answer:
Verified
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