Which of the following is not correct?
A)There is a greater reduction in risk by increasing the number of stocks in a portfolio from 1 to 10,than by increasing it from 100 to 120 stocks.
B)The historical rate of return on stocks has been about 5 percentage points higher than the historical rate of return on bonds.
C)Stock in an industry that is very sensitive to economic conditions is likely to have a higher average return than stock in an industry that is not so sensitive to economic conditions.
D)If you had information about a corporation that no one else had,you could earn a very high rate of return.This contradicts the efficient market hypothesis.

Question

Quizplus · Accepted Answer

The efficient market hypothesis suggests that all available information is already reflected in stock prices, so having unique information could indeed lead to higher returns, contradicting the hypothesis.

Which of the Following Is Not Correct