Which of the following portfolios has the least reduction of risk?
A. A portfolio with securities all having positive correlation with each other
B. A portfolio with securities all has zero correlation with each other
C. A portfolio with securities all having negative correlation with each other
D. A portfolio with securities all has skewed correlation with each other
Answer: Option A
Solution(By Examveda Team)
A portfolio with securities all having positive correlation with each other has the least reduction of risk. A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds.This Question Belongs to Commerce >> Financial Management
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Investment is the _______________.
A. net additions made to the nation’s capital stocks
B. person’s commitment to buy a flat or house
C. employment of funds on assets to earn returns
D. employment of funds on goods and services that are used in production process
Financial Management is mainly concerned with ______________.
A. All aspects of acquiring and utilizing financial resources for firms activities
B. Arrangement of funds
C. Efficient Management of every business
D. Profit maximization
The primary goal of the financial management is ____________.
A. to maximize the return
B. to minimize the risk
C. to maximize the wealth of owners
D. to maximize profit
In his traditional role the finance manager is responsible for ___________.
A. proper utilisation of funds
B. arrangement of financial resources
C. acquiring capital assets of the organization
D. efficient management of capital
It's wrong I think, negative correlation is the correct answer
if there is positive relation then all securities moves in same direction then how we can get least risk portfolio...now this time give explaination