The standard deviation for a set of stock returns can be calculated as the:
A)positive square root of the average return.
B)average squared difference between the actual return and the average return.
C)positive square root of the variance.
D)average return divided by N minus one,where N is the number of returns.
E)variance squared.

Question

Quizplus · Accepted Answer

The standard deviation is the positive square root of the variance. The variance is calculated as the average of the squared differences between each return and the average return. Therefore, choice C is the correct answer as it describes the correct calculation for the standard deviation.

The Standard Deviation for a Set of Stock Returns Can