Historically, which of the following asset classes has exhibited the smallest standard deviation of monthly returns?

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Vân Thảo
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75 questions
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1.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Large-capitalization stocks.
Long-term corporate bonds.
Treasury bills.
2.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
In a two-asset portfolio, reducing the correlation between the two assets moves the efficient frontier in which direction?
The efficient frontier is stable unless the asset's expected volatility changes. This depends on each asset's standard deviation.
The frontier extends to the left, or northwest quadrant representing a reduction in risk while maintaining or enhancing portfolio returns.
The efficient frontier is stable unless return expectations change. If expectations change, the efficient frontier will extend to the upper right with little or no change in risk.
3.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Stock A has a standard deviation of 10.00. Stock B also has a standard deviation of 10.00. If the correlation coefficient between these stocks is 1.00, what is the covariance between these two stocks?
1.00.
-100.00.
0.00.
4.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Which of the following statements about risk aversion is CORRECT?
Risk averse investors will not take on risk.
Given a choice between two assets with equal rates of return, the investor will always select the asset with the lowest level of risk.
Risk aversion implies that the risk-return line, the CML, and the SML are downward sloping curves.
5.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
If the standard deviation of stock A is 13.2 percent, the standard deviation of stock B is 17.6 percent, and the covariance between the two is 0, what is the correlation coefficient?
+1
0.
0.31.
6.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Which of the following portfolios falls below the Markowitz efficient frontier?
B.
C.
D.
7.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
The graph below combines the efficient frontier with the indifference curves for two different investors, X and Y. Which of the following statements about the above graph is least accurate?
The efficient frontier line represents the portfolios that provide the highest return at each risk level.
Investor X's expected return will always be less than that of Investor Y.
Investor X is less risk-averse than Investor Y.
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