Asset Class Risk

 

From the above discussion, you have learned that individual stocks tend to correlate with stocks of companies that are in the same business.  You have also noted that broad indices of stocks can trade up and down together.  The movements of the Dow Jones Industrial Average and the S&P 500 are constant reminders of this phenomenon.  There is a Wall Street saying that “rising tides lift all ships.”

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Last Updated: 6/25/2018