How does the diversification of an investor's portfolio avoid risk? A. If an investor buys stocks that are negatively correlated, as the number of stocks held increases, the overall variance of the portfolio increases. B. If an investor buys stocks that are positively correlated, as the number of stocks held increases, the overall variance of the portfolio increases. C. If an investor buys stocks that are negatively correlated, as the number of stocks held increases, the overall variance of the portfolio decreases. D. If an investor buys stocks that are positively correlated, as the number of stocks held increases, the overall variance of the portfolio decreases.
Answers (1)
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “How does the diversification of an investor's portfolio avoid risk? A. If an investor buys stocks that are negatively correlated, as the ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Rafi offers a tour of Bay Harbor aboard his sailboat, Sea Siren, to Tiara's Travel Group for $500. Referring to the prices for similar tours, Tiara's says, "We'll pay no more than $400." Rafi's offer is: a. still open. b. terminated. c.
Answers (1)
If John works for Kinjo's Printing Services during the day and Joe's Diner at night, this would be considered a conflict of interest.
Answers (1)
Which of the following procedures would be generally performed when evaluating the accounts receivable balance in an engagement to review financial statements in accordance with Statements on Standards for Accounting and Review Services?. A.
Answers (1)
What qualifications are the officials of lilliput expected to have in order to hold high office?
Answers (1)
On March 1, 2018, Lewis Services issued a 6% long-term notes payable for $18,000. It is payable over a 3-year term in $6000 principal installments on March 1 of each year, beginning March 1, 2019.
Answers (1)
New Questions in Business
Sally and Alicia are equal general partners In a business. They are content with their current management and tax situation but are uncomfortable with their unlimited liability.
Answers (1)
The philosophical leaders of the quality movement, Philip Crosby, W. Edwards Deming, and Joseph M. Juran, had the same general message about what it took to achieve outstanding quality. Which of the following was not part of that message? A.
Answers (1)
Joe Keho and Mike McLain share income on a 6:4 basis. They have capital balances of $90,000 and $70,000, respectively, when Linda Ronstadt is admitted to the partnership.
Answers (1)
Suppose an initial investment of $100 will return $50/year for three years (assume the $50 is received each year at the end of the year). Is this a profitable investment if the discount rate is 20%
Answers (1)
Investment A for $100,000 is invested at a nominal rate of interest, j, convertible semiannually. After 4 years, it accumulates to 214,358.88. (b) Investment B for $100,000 is invested at a nominal rate of discount, k, convertible quarterly.
Answers (1)