Statements about beta and risk

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Which of the following statements about beta and risk is correct??

a. ?A stock's beta is less relevant as a measure of risk to an investor with a well-diversified portfolio than to an investor who holds only one stock.

b. ?A security's beta measures its diversifiable (systematic, or market) risk relative to that of other securities.

c. ?If the returns of two firms are negatively correlated, one of them must have a negative beta.

d. ?If two stocks have the same standard deviation and the correlation coefficient between the returns of two stocks equals zero, an equally weighted portfolio of the two stocks will have a standard deviation equal to that of the individual stocks.

e. ?Combining stocks with perfectly positively correlated stock returns into a portfolio is less risky than holding an individual stock since the portfolio will benefit from diversification.

Reference no: EM131901629

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