What is the standard deviation of returns for an investment that is equally likely to return 100% as it is to provide a 100% loss?
A) 0%
B) 50%
C) 71%
D) 100%

Name: What is the standard deviation of returns for an investment that is equally likely to return 100% as it is to provide a 100% loss? A) 0% B) 50% C) 71% D) 100%
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Quizplus · Accepted Answer

Mean = 0.5 × 100% + 0.5 × −100% = 0%Variance = 0.5 × (100 − 0)² + 0.5 × (−100 − 0)² = 10,000Std dev = 10,000^0.5 = 100%

What Is the Standard Deviation of Returns for an Investment