Asked by Madilyn McPherson on Apr 28, 2024
Verified
The higher the standard deviation, the less predictable the rate of return in any one year.
Standard Deviation
A statistical measure that quantifies the variation or dispersion of a set of data points, commonly used in finance to gauge the volatility of investment returns.
Predictable
Something that can be anticipated or expected based on certain indicators or patterns.
Rate Of Return
The gain or loss of an investment over a specified period, expressed as a percentage of the investment’s initial cost.
- Acquire insights into the role of standard deviation and variance in evaluating the volatility and risk associated with investments.
Verified Answer
ZK
Zybrea KnightMay 03, 2024
Final Answer :
True
Explanation :
A higher standard deviation indicates a wider dispersion of returns around the mean, meaning there is more variability and less predictability in the rate of return.
Learning Objectives
- Acquire insights into the role of standard deviation and variance in evaluating the volatility and risk associated with investments.