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[BUSINESS] You are working on the launch of a critical new product at your company. You have estimated the probability of success and potential impacts

[BUSINESS]

You are working on the launch of a critical new product at your company. You have estimated the probability of success and potential impacts on the stock price over the next year. If the risk-free rate is 2% and the standard deviation is 19.2%, then whats the CV and Sharpe Ratio? All else equal, would you prefer a higher CV?

Product Launch Outcome

Outcome Probability

Stock Rate Outcome

Poor

10%

-40%

Mediocre

30%

8%

Good

40%

18%

Awesome

20%

32%

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