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    Exam 11: Optimal Portfolio Choice and the Capital Asset Pricing Model
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    Consider an Equally Weighted Portfolio That Contains Five Stocks
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Consider an Equally Weighted Portfolio That Contains Five Stocks

Question 97

Question 97

Multiple Choice

Consider an equally weighted portfolio that contains five stocks.If the average volatility of these stocks is 40% and the average correlation between the stocks is .5,then the volatility of this equally weighted portfolio is closest to:


A) 0.17
B) 0.44
C) 0.41
D) 0.19

Correct Answer:

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