Example: Find the CV of Stock A and B Economic Outcome Probability Return Stock A Stock...

Example: Find the CV of Stock A and B

Economic Outcome	Probability	Return
Economic Outcome	Probability	Stock A	Stock B
1. Recession	P₁ = .20	R₁ = .01	R₁ = .02
2. Recovery	P₂ = .50	R₂ = .10	R₂ = .04
3. Growth	P₃ = .30	R₃ = .12	R₃ = .08
Expected Return (R)		8.8%	4.8%
Standard Deviation (σ)		3.99%	2.23%
Coefficient of Variation (CV)

Expert Solution

jeff jeffy answered 2 years ago

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