Based on the information given below,which of the investments would be considered best based on its risk and return relationship? Assume all investors are risk-averse and the investments will be held in isolation,not in a portfolio.
A) D, because its total risk is lowest.
B) E, because its coefficient of variation is lowest.
C) F, because its standard deviation, $\sigma$, is highest.
D) E and F, because the have the same expected return,.
E) None of the above.

Question

Based on the information given below,which of the investments would be considered best based on its risk and return relationship? Assume all investors are risk-averse and the investments will be held in isolation,not in a portfolio. 
A) D, because its total risk is lowest. 
B) E, because its coefficient of variation is lowest. 
C) F, because its standard deviation, $\sigma$, is highest. 
D) E and F, because the have the same expected return,. 
E) None of the above.

Quizplus · Accepted Answer

Investment E has the highest expected return and the lowest standard deviation among all investment options. Therefore, its coefficient of variation (CV) is the lowest, indicating a better risk and return relationship. As all investors are risk-averse, they would prefer an investment with a lower risk and higher return. Hence, investment E is the best choice.

Based on the Information Given Below,which of the Investments Would σ\sigmaσ

Based on the Information Given Below,which of the Investments Would $\sigma$