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    For a Two-Stock Portfolio, the Maximum Reduction in Risk Occurs
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For a Two-Stock Portfolio, the Maximum Reduction in Risk Occurs

Question 33

Question 33

Multiple Choice

For a two-stock portfolio, the maximum reduction in risk occurs when the correlation coefficient between the two stocks equals


A) +1.0.
B) -0.5.
C) -1.0.
D) 0.0.

Correct Answer:

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