How is the standard deviation of returns calculated?

Q: How do the Internal-Rate-of-Return Criterion relate to the PW Analysis?

A: Capital budgeting:   It is the process in which the business uses to determine which proposed fixed…

Q: Which are the Methods for Finding Rate of Return?

A: A Rate of Return (ROR) is the gain or loss of an investment over a certain period of time. When the…

Q: Compare and contrast dollar returns and rates of return.

A: The returns from any investment can be calculated in terms of value (amount terms) or percentages.

Q: The Sharpe ratio is computed as the average: excess return divided by the variance of the returns )…

A: Sharpe ratio is the value that is obtained by dividing the equity risk premium by the standard…

Q: s. What is the geometric average return for this time period?

A: Geometric Average: It is the average return for a set of values computed with the products of the…

Q: Why is the variance (or standard deviation) used as a measure of risk? What are the advantages and…

A: Reasons of utilizing variance as a risk measure: While consider a lesser risk in investment, fewer…

Q: How is the Current Ratio calculated?

A:

Q: calculate the standard deviation of returns.

A: Standard Deviation is the square root of the variance, which is the measurement of risk. And risk…

Q: The variance and its square root, the standard deviation, are the most commonly used measures of…

A: Variance refers to the expectation of squared deviation of a random value from its arithmetic mean.…

Q: e measure of volatility is Select one: a. sigma. b. standard deviation.  c. sigma squared. d.…

A: Volatility is change in stock price in up and down. That is very important in option pricing.

Q: What is the Internal-Rate-of-Return Criterion?

A: Internal rate of return (IRR): The internal rate of return (IRR) is a measure utilized in capital…

Q: difference between internal rate of return and net present value?

A: Difference between internal rate of return and net present value?

Q: Total risk is measured by and systematic risk is measured by Beta; standard deviation. Standard…

A: There are two types of risks systematic risk and unsystematic risk

Q: Define average return

A: The formula to compute average return as follows:

Q: Which different terms are used to refer to rate of return?

A: Rate of return is the return that is expected by the investors from the investment made. It is…

Q: What is the gradient-series present-worth factor with formula?

A: Step 1: When there is a uniformly change in rate of interest is a gradient series of cash flow. It…

Q: Basic Elements of Risk-Adjusted Returns?

A: Introduction: Risk adjusted return is a methodology for calculating and evaluating the returns on an…

Q: Illustrate the calculation of the standard deviation of returns?

A: Standard deviation refers to a measure of variation or dispersion of a set of values. We can…

Q: What is risk return ratio?

A: Any susceptibility a corporation or organization has to factors that might affect profitability or…

Q: standard deviation of returns?

A: Risk is the value of volatility around the mean. It is measured via variance or square root of…

Q: Describe the Internal-Rate-of-Return Criterion?

A: Internal rate of return (IRR) is defined as the rate of discount at which the NPV of human capital…

Q: What would be the expected value, variance and standard deviation of an event that always took the…

A: Expected value :- Expected value is anticipated future value of an event.  Standard Deviation:-…

Q: Can someone give an example of Mean-Variance analysis?

A: Example for mean-variance analysis:

Q: How does the application of the standard deviation differ from the application of the coefficient of…

A: a. Standard Deviation: The average fluctuation of a variable around the mean is known as standard…

Q: What is the tainting percentage? How is it calculated?

A:

Q: What is the difference between positive and negative predictive value?

A: Positive predictive value is the probability that subjects with a positive screening test truly have…

Q: Can someone give an example or scenario of mean-variance analysis?

A: Introduction: Mean-variance analysis is a method used by investors to make investment decisions on…

Q: What is the expected spot rate?

A: A spot rate is a price quoted for immediate settlement on an interest rate, commodity, security, or…

Q: Standard deviation measures which type of risk?

A: Standard deviation is an important measure of risk in finance.

Q: what is the difference between a required rate of return and an expected rate of return?

A: Rate of return (ROR) is a value at which an investor earns additional amount on invested amount…

Q: What was the correlation between both return series?

A: Answer: Introduction: A linear correlation measure between two variables that is, An independent of…

Q: What does the current ratio measure?

A: Ratios are the group of metrics which are used to measure the profitability as well as efficiency of…

Q: WHAT IS THE TOTAL CURRENT RATIO?

A: Current ratio is a ratio used for measuring the liquidity of the business that how much current or…

Q: Is there a difference between arithmetic and geometric average returns? Is it true that they…

A: Geometric average is generally used by investment professionals to measure the performance of…

Q: how was the rate found?

A: Details about property are as follows: Name of Item Date of purchase Relates to which Quarter…

Q: Write an alternative way to derive the geometric-gradient-series present-worth?

A: Geometric-gradient-series present worth is derived with the help of the following formula: g is…

Q: What is the relationship between risk and return?

A: Risk return relationship: The association among risk and return is recognized as the risk-return…

Q: What is meant by the current ratio?

A: The current ratio is liquidity which measures the ability of the enterprise to pay its short-term…

Q: d the (a) variance and (b) standard deviation

A:

Q: What is a revenue variance and what does it mean?

A:

Risk and return

Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary. 

Capital Asset Pricing Model

Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.