Which of the following statements about the correlation coefficient is false?
A)The values range between -1 to +1.
B)A value of +1 implies that the returns for the two stocks move together in a completely linear manner.
C)A value of -1 implies that the returns move in a completely opposite direction.
D)A value of zero means that the returns are independent.
E)None of the above (that is, all statements are true)

Question

Quizplus · Accepted Answer

A value of zero means there is no linear relationship between the returns, but it does not imply independence.

Which of the Following Statements About the Correlation Coefficient Is