A security has annual returns 5%, 10% and 15% The coefficient of variation of the security (using pop standard deviation) is closest to a 0.3 b 0.4 c 0.5 d 0.6
B it is 0.408248
b i was using sample std
can you show your workings plse?
mean=10 std=4.08 c.o.v=std/mean=0.4 it should be b.
wouldn’t it be c because it states population standard deviation??
Std deviation using pop = (5-10)^2 + 0 + (15-10)^2/3 and square root of this. Mean is 10 we have 4.08248/10 = 0.4
the dubs… std=sqrt(50/3) it is the population and that is 3.
i see what i was doing wrong… you guys are good. Answer was B.
nope we are not good… just did the problem x times and now recognize the answer by just looking at it… lol…
Dubs, it’s b precisely b/c they want you to use population std dev (i.e. divide by N=3, rather than by 2, which is what you should be doing if they didn’t say that’s a population)