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Homework answers / question archive / What is the typical relationship between the standard deviation of an individual common stock and the standard deviation of a diversified portfolio of common stocks? The individual stock's standard deviation will be higher
What is the typical relationship between the standard deviation of an individual common stock and the standard deviation of a diversified portfolio of common stocks? The individual stock's standard deviation will be higher. The individual stock's standard deviation will be lower The standard deviations should be equal There is no relationship
A) The individual stock standard deviation will be higher
As portfolio have less risk than an individual stock
