One of the best Investment Rule is to never put eggs in One Basket. This means we have to diversify our Investment. This is because if one investment is in loss, it will risk whole of your funds. This is the investment Rule in financial Market. Once the relative risk of the portfolio is determined, it's return is calculated. For this the correlation of Returns of various Assets are calculated. The correlation is an indicator of relative risks. Thus a wise investment decision is the one in which there is a correlation between assets in portfolio Such that it provides a positive return.
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