There is no reduced risk in a portfolio of securities when The securities in the

Question

There is no reduced risk in a portfolio of securities when

The securities in the portfolio are positively correlated

The securities in the portfolio are perfectly  positively correlated

The securities in the portfolio are negatively correlated

The securities in the portfolio are perfectly negatively correlated

Risk can never be reduced by holding securities in a porfolio

The securities in the portfolio are positively correlated

The securities in the portfolio are perfectly  positively correlated

The securities in the portfolio are negatively correlated

The securities in the portfolio are perfectly negatively correlated

Risk can never be reduced by holding securities in a porfolio

Explanation / Answer

The securities in the portfolio are perfectly  positively correlated

when the correlation is +1 there is no reduced risk

The securities in the portfolio are perfectly  positively correlated

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