CFA Practice Question

There are 294 practice questions for this study session.

CFA Practice Question

A two-asset portfolio with a standard deviation of zero can be formed when the assets have a correlation coefficient equal to ______.
A. zero
B. one
C. negative one
Explanation: In this case the two assets move in opposite directions 100% of the time.

User Contributed Comments 2

User Comment
ksnider could someone explain this?
sagrr correlation coefficient equal to -1 would mean everytime A went up by 4, B goes down by -4. ... no risk
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