Question

A measure of how the returns of two risky assets move in relation to each other is the:

Q: Answer-A measure of how the returns of two risky assets move in relation to each other is the:

The covariance is defined as the co-movement of the returns of two assets or how well the returns of risky assets move together. Range and standard deviation are measures of dispersion and measure risk, not how assets move together.

A Range

B Covariance

C Standard deviation

D Coefficient of correlation

E Correlation

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A measure of how the returns of two risky assets move in relation to each other is the:

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