Perfect Positive Correlation
At a correlation of +1 all combinations of two securities lie on a straight line, no combination beats either security on both dimensions, and there is no possibility of risk diversification — described by the workbook…
This one is not written up yet
The definition above is the short version. A full explanation — how it works, a worked example and the exam traps — is still being written. In the meantime the chapter below covers it in context.
Written up from the same chapter
Where this is taught
Free preparation for NISM Series XIX-C← All terms