The real utility of the coefficient of variation is in comparing assets that have equal expected returns.

Question

Quizplus · Accepted Answer

The real utility of the coefficient of variation is in comparing the risk relative to the expected return of different assets, not just those with equal expected returns. It allows for comparison of the degree of variability (risk) relative to the mean (expected return), making it useful for comparing assets with different levels of expected returns.

The Real Utility of the Coefficient of Variation Is in Comparing