Which of the following statements regarding the correlation coefficient is not true?
A)It is a statistical measure
B)It measure the relationship between two securities' returns
C)It determines the causes of the relationship between two securities' returns
D)It is greater than or equal to -1 and less than or equal to +1

Question

Quizplus · Accepted Answer

The correlation coefficient measures the degree of association or relationship between two variables, in this case, two securities' returns. However, it does not determine the causes of this relationship. The causes should be explored separately through other analysis or research.

Which of the Following Statements Regarding the Correlation Coefficient Is