Volatility lower than that of the original? stocks

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Arbor Systems and Gencore stocks both have a volatility of 46 %. Compute the volatility of a portfolio with 50 % invested in each stock if the correlation between the stocks is ?

(a?) plus 1.00

?(b?) 0.50

(c?) 0.00

?(d?) -0.50

?(e?) -1.00

In which of the cases is the volatility lower than that of the original? stocks?

Reference no: EM132281504

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