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Reading 26 EOC Question 11

Hey Guys

How did they calculate 28.78? I am getting 22.6.

R*=0.416

So as an example Jan = Min(3.5-0.416,0)*2

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they are asking for downside deviation.

so you need to look at only those points where the return is < average return over the 12 month period (which is 0.6416) and only for those numbers do the sum of (return-0.416)^2

that did turn out to be 28.78…. for the 6 periods where return is < 0.6416

CP

Thanks, it was forumla mistake in excel.

idreesz wrote:
Thanks, it was forumla mistake in excel.

Who typed in the forumla (sic)?

wink

Simplify the complicated side; don't complify the simplicated side.

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