You observe the following information regarding Company A and Company B:
Company A has a higher expected return than Company B.
Company A has a lower standard deviation of returns than Company B.
Company A has a higher beta than Company B.
Given this information, which of the following statements is CORRECT?
a. Company A has more company-specific risk than Company B.
b. Company A has a higher Sharpe ratio than Company B.
c. Company A has a higher coefficient of variation than Company B.
d. Company A’s returns will be negative when Company B’s returns are positive.
e. Company A has less market risk than Company B.
Online Tutoring, Online Tutors
