Stocks with high returns are expected to have:
A)high variability.
B)low variability.
C)no relation to variability.
D)inverse relationship with variability.
E)no variability.

Question

Quizplus · Accepted Answer

Stocks with high returns are generally associated with high variability or volatility. This is because higher returns often come with higher risks, and higher risks lead to greater fluctuations in the stock's price. Lower-risk investments typically offer lower returns but come with lower variability. Therefore, high variability is expected for stocks with high returns.

Stocks with High Returns Are Expected to Have