Abstract

https://ssrn.com/abstract=2155136
 


 



Intraportfolio Correlation: An Application for Investments Students


Lynda Livingston


University of Puget Sound - School of Business and Leadership

2013

Business Education & Accreditation, v. 5 (1) p. 91-105

Abstract:     
Intraportfolio correlation (IPC), a measure of portfolio diversification, is becoming increasingly popular among investment practitioners. However, despite the assertions of these adherents, IPC is far from a free lunch. Instead, it is a simplistic and flawed measure that ignores material information about the relationships among portfolio assets. Deconstructing the IPC therefore can be a productive and educational exercise (and a cautionary tale) for students of portfolio theory. In this paper, we describe IPC and offer suggestions for incorporating it into an introductory investments course.

Number of Pages in PDF File: 16

Keywords: Portfolio Theory, Diversification, Finance Pedagogy

JEL Classification: G10, G11


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Date posted: January 29, 2013  

Suggested Citation

Livingston, Lynda, Intraportfolio Correlation: An Application for Investments Students (2013). Business Education & Accreditation, v. 5 (1) p. 91-105. Available at SSRN: https://ssrn.com/abstract=2155136

Contact Information

Lynda Livingston (Contact Author)
University of Puget Sound - School of Business and Leadership ( email )
1500 N Warner St.
Tacoma, WA 98416
United States
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