- CFA Exams
- CFA Level I Exam
- Topic 9. Portfolio Management
- Learning Module 1. Portfolio Risk and Return: Part I
- Subject 4. Portfolio Risk, Return and Diversification
CFA Practice Question
The variance of a three-stock portfolio contains ______ individual variance terms and ______ unique covariance terms.
B. 3; 6
C. 6; 6
D. 3; 9
E. 6; 9
A. 3; 3
B. 3; 6
C. 6; 6
D. 3; 9
E. 6; 9
Correct Answer: A
User Contributed Comments 4
| User | Comment |
|---|---|
| myanmar | 3 companies A,B,C three possible covariance outcomes: AB AC BC |
| surob | the formula to compute covariance count - n(n-1)/2 |
| ljamieson | nC2 = n(n-1)/2 |
| Phlipsen | thanks ljamieson |