Two assets whose returns move in the same direction and have a correlation coefficient of +1 are very risky assets.

Name: Two assets whose returns move in the same direction and have a correlation coefficient of +1 are very risky assets.
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Quizplus · Accepted Answer

A correlation coefficient of +1 indicates that the two assets move in the same direction perfectly, but it does not inherently determine their risk level. Risk is assessed by other measures such as volatility, not correlation.

Two Assets Whose Returns Move in the Same Direction and Have