Hi, Do we use geometric mean (instead of arithmetic mean) in Coef. of Variation calculation = Std. Dev/geometric mean? I also noticed in mock exam that they used geometric mean for sharpe ratio = (geometric mean - RFR)/Std. Deviation. Could anyone confirm? Thank you.
By definition it should be the arithmetic mean for both, check the Mock again, I remember using the Am NOT the Gm.
Strange. I’m pretty sure arithmetic mean is standard in both cases.
you wouldnt use geometric mean in a cov calculation. that doesnt make any sense
here’s finally found the question. Given, Arithmetic mean return = 14.30% Geom. mean return = 12.70% Variance = 380 Beta = 1.35 RFR = 4.25% The Coef. of Variation and Sharpe Ratio, respectively are: A) 1.36, 0.52 B) 1.36, 7.44 C) 1.53, 0.52 D) 1.53, 7.44