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Question
You currently have a portfolio comprised of 70 percent stocks and 30 percent bonds. Which one of the following must be true if you change the asset allocation?A. The expected return will remain constant.
B. The revised portfolio will be perfectly negatively correlated with the initial portfolio.
C. The two portfolios could have significantly different standard deviations.
D. The portfolio variance will be unaffected.
E. The portfolio variance will most likely decrease in value.
Answer
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Which one of the following statements regarding an original issue $25,000 GNMA bond is correct?
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