The returns of two securities have a strong negative relationship. The most likely covariance between them is Group of answer choices -1.05 -105 +20 -300 any of the above except c
The returns of two securities have a strong negative relationship. The most likely covariance between them is Group of answer choices -1.05 -105 +20 -300 any of the above except c
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
The returns of two securities have a strong negative relationship. The most likely covariance between them is
Group of answer choices
-1.05
-105
+20
-300
any of the above except c
Expert Solution
Step 1
Correlation is a numeric value that ranges from negative one to positive one and even becomes zero implying the relationship shared by two variables like returns of stocks of different sectors over analysis period.
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