Question

the standard deviation of the returns of stock y is 47.5%, and the expected return from the stock is 16%. calculate the coefficient of variation of the stock. (round to two decimal places.)

Answer 1

The coefficient of variation for stock Y is calculated by dividing the standard deviation (47.5%) by the expected return (16%) and then converting to a percentage. After rounding to two decimal places, it is 296.88%.

Step-by-step explanation:

To calculate the coefficient of variation of stock Y with a standard deviation of 47.5% and an expected return of 16%, you would divide the stock's standard deviation by its expected return and then multiply by 100 to convert it to a percentage:

Coefficient of Variation = (Standard Deviation / Expected Return) × 100

Coefficient of Variation = (47.5% / 16%) × 100

Coefficient of Variation = 2.96875 × 100

Coefficient of Variation = 296.875%

After rounding to two decimal places, the coefficient of variation for stock Y is 296.88%.