The coefficient of variation is a measure of relative dispersion that is useful in comparing the risks of assets with different expected returns.

Question

Quizplus · Accepted Answer

The coefficient of variation is defined as the ratio of the standard deviation to the mean of a dataset. It is a useful metric for comparing the relative risk of assets that have different expected returns, as it provides a way to compare the level of risk per unit of expected return. Therefore, the statement is true.

The Coefficient of Variation Is a Measure of Relative Dispersion