When asked to calculate CV and given both GM and AM, is GM recommended since it is a better measure of mean?

AM is what is used in calculating CV

definitely geometric mean edit : didn’t realize you mean ‘coefficient of variation’ - disregard, use arithmetic mean

I would use GM, because it is more conservative. I have seen only one questions on the CFAI mock and I had to use the GM to get the right answer.

cfaiscomplex Wrote: ------------------------------------------------------- > When asked to calculate CV and given both GM and > AM, is GM recommended since it is a better measure > of mean? in general geo mean is a better capture of what happens over the long term. I think you use geo mean in CV formual not sure CV = sigma/mean BOOM keep em coming,

ohh coefficient of variation i think you would use arithmetic mean

supersharpshooter Wrote: ------------------------------------------------------- > ohh coefficient of variation > > i think you would use arithmetic mean CV is a sanity check on st dev and sharpe ratio, that is why we use it

i thought it was ‘current value’ or whatever lol

sorry meant coeff of variation… looks like we always use GM when both are given to get the right answer…

getterdone Wrote: ------------------------------------------------------- > I would use GM, because it is more conservative. > > I have seen only one questions on the CFAI mock > and I had to use the GM to get the right answer. Really, because I am looking at the feedback pdf and they calculated (edit: both CV and Sharpe ratio) using the AM

CV = s/Xbar i have never seen Xbar expressed as the geometric mean

exactly…its always AM…

I just realized I made a mistake, I was thinking for some reason about returns calculations, it is supposed to be the arithmetic mean. stupid mistakes!

cfaiscomplex, you are probably looking at a bootleg version of the answer sheet - i have seen that document, the guy makes lots and lots of mistakes in his answers

supersharpshooter Wrote: ------------------------------------------------------- > cfaiscomplex, you are probably looking at a > bootleg version of the answer sheet - i have seen > that document, the guy makes lots and lots of > mistakes in his answers I would be wary of this version, because the cfa feedback document actually works out the problem on this one!

can you send me the cfaversion please???

check your email

are you talking mock answers? If so, I hate to do this as I have seen so many people requesting it, but as I review my mock answers I have found errors and am questioning if I am using a bad review sheet. Could ya pass it on my way if you have it, thanks. tjvedder@gmail.com

always use AM…only use GM when referring to returns.