FIN 534 RANK Change The World /fin534rank.com FIN 534 RANK Change The World /fin534rank.com | Seite 96

You have the following data on three stocks:
Stock Standard Deviation Beta
A 20% 0.59
B 10% 0.61
C 12% 1.29
If you are a strict risk minimizer, you would choose Stock ____ if it is to
be held in isolation and Stock ____ if it is to be held as part of a well-
diversified portfolio.
Answer
Correct Answer:
Question 13
2 out of 2 points
Stock A has a beta of 0.8, Stock B has a beta of 1.0, and Stock C
has a beta of 1.2. Portfolio P has equal amounts invested in each of the
three stocks. Each of the stocks has a standard deviation of 25%. The