You have the choice of introducing either Stock X or Stock Y into your fully diversified portfolio.Both stocks have 5 units of systematic risk while Stock X has 6 units of unsystematic risk and Stock Y has 8 units of unsystematic risk.Which stock offers the greatest opportunity from diversification?
A) Stock X
B) Stock Y
C) both stock offer the same opportunity
D) there is not enough information to determine the answer
Correct Answer:
Verified
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Exhibit 6-1
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Exhibit 6-2
You purchased a bond
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