Which of the following statements is FALSE?
A)Expected return should rise proportionately with volatility.
B)The shares of the largest companies are typically more volatile than a portfolio of large cap shares.
C)Investors would not choose to hold a portfolio that is more volatile unless they expected to earn a higher return.
D)Smaller company shares have lower volatility than larger stocks.

Question

Quizplus · Accepted Answer

Smaller company shares tend to have higher volatility than larger stocks. This is because smaller companies tend to have less established businesses and are therefore subject to greater uncertainties and risks.

Which of the Following Statements Is FALSE