Sppose that the correlation between stocks a and b is pab , Financial Management

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Sppose that the correlation between stocks a and b is pab

Suppose that the correlation between stocks A and B is Pab = -1, instead of Pab = 0.75. Which of the following Statements correctly reflects the new data?

A) the risk associated with the portfolio is higher

B) the risk associated with the portfolio is the same as when the correlation is Pab = 0.75

C) the expected return to the portfolio is lower

D) the risk associated with the portfolio is lower

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Financial Management: Sppose that the correlation between stocks a and b is pab

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Financial Management: Sppose that the correlation between stocks a and b is pab

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