Assume that stock market returns do not resemble a single-index structure. An investment fund analyzes 132 stocks in order to construct a mean-variance efficient portfolio constrained by 132 investments. They will need to calculate ____________ covariances.
A. 100
B. 132
C. 4,950
D. 8,646
D. 8,646
(n2 – n)/2 = (17,424 – 132)/2 = 8,646 covariances must be calculated.
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