If the covariance of stock 1 with stock 2 is

Question

If the covariance of stock 1 with stock 2 is - .0065,then what is the covariance of stock 2 with stock 1?
A) -.0065
B) +.0065
C) greater than +.0065
D) less than -.0065
E) Need additional information.

Quizplus · Accepted Answer

Covariance is a symmetric measure, which means the order of the stocks does not matter. Therefore, the covariance of stock 2 with stock 1 is the same as the covariance of stock 1 with stock 2, which is -0.0065. So the answer is A.