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Basic Question 6 of 8
What is the correlation between consecutive observations in a true random walk?
A. Positive correlation.
B. Negative correlation.
C. Zero correlation.
D. Correlation depends on the time span.
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I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
Andrea Schildbach
Learning Outcome Statements
explain the instability of coefficients of time-series models;
describe characteristics of random walk processes and contrast them to covariance stationary processes;
CFA® 2025 Level II Curriculum, Volume 1, Module 5.