Which of the following statements about the standard capital asset pricing model is correct when holding all other things constant?
A. For a security with a beta greater than 1, an increase in the risk-free rate will decrease its expected return.
B. The expect return on a security decreases when its correlation with the market increases.
C. The security market line shows the relationship between a security's returns and its diversifiable risk
D. High-beta stocksare suitable to invest when market is trending upwards
Answer:D