Which security is more risky


Response to the following problem:

Security A has an expected rate of return of 6 percent, a standard deviation of returns of 30 percent, a correlation coefficient with the market of 0.25, and a beta coefficient of 0.5. Security B has an expected return of 11 percent, a standard deviation of returns of 10 percent, a correlation with the market of 0.75, and a beta coefficient of 0.5. Which security is more risky? Why?

 

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Financial Accounting: Which security is more risky
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