Which security has the greatest expected return?
A) Y because it has the largest standard deviation.
B) X because it has the largest beta coefficient.
C) Z because it has the highest ratio of standard deviation to beta.
D) Y because it has the lowest beta coefficient, and therefore the lowest risk.
E) It is not possible to tell given the information above.

Question

Which security has the greatest expected return?
A) Y because it has the largest standard deviation. 
B) X because it has the largest beta coefficient. 
C) Z because it has the highest ratio of standard deviation to beta. 
D) Y because it has the lowest beta coefficient, and therefore the lowest risk. 
E) It is not possible to tell given the information above.

Quizplus · Accepted Answer

The Answer of  Which security has the greatest expected return?
A) Y because it has the largest standard deviation. 
B) X because it has the largest beta coefficient. 
C) Z because it has the highest ratio of standard deviation to beta. 
D) Y because it has the lowest beta coefficient, and therefore the lowest risk. 
E) It is not possible to tell given the information above.

Which Security Has the Greatest Expected Return