The most important determinant of an investment's portfolio risk is which of the following?

A. The standard deviation of the investment's return distribution

B. The variance of the investment's return distribution

C. The size of the investment

D. The correlation of the investment's returns with the returns of other investments in the portfolio

E. The risk-free rate of return

2. If a bank pays quarterly compounding on its savings accounts, the ending amount after one year on a $1,000 deposit will be less than if the bank paid annual compounding.

True

False