Which of the following is not true about serial correlation?
A)Significant positive or negative serial correlation coefficients are indicative of market inefficiency in the weak form.
B)It involves only one security.
C)Negative serial correlation indicates a tendency toward reversal.
D)Positive serial correlation indicates a tendency for continuation.
E)It measures the correlation between the current return on a security and the current return on another security.

Question

Quizplus · Accepted Answer

Serial correlation measures the correlation between the current return on a security and the past return on the same security, not the current return on another security.

Which of the Following Is Not True About Serial Correlation