You have a sample of returns observations for the Malta Stock Fund. The 4 returns are 0.0725, 0.056, 0.125, 0.010. What is the average return and variance of these returns?
A) 6.50%, 0.0017.
B) 6.60%, 0.0023.
C) 26.35%, 0.0067.
D) 8.80%, 0.0017.

Question

Quizplus · Accepted Answer

The average return is calculated as the sum of the returns divided by the number of observations: (0.0725 + 0.056 + 0.125 + 0.010) / 4 = 0.065 or 6.50%. The variance is calculated by finding the average of the squared differences from the mean, which results in 0.0023.

You Have a Sample of Returns Observations for the Malta