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Understanding risk: Part A: Stock A has a standard deviation of 10% and an expected return of 8%. Stock B has a standard deviation of
Understanding risk:
- Part A: Stock A has a standard deviation of 10% and an expected return of 8%. Stock B has a standard deviation of 15% and an expected return of 11%. A client wants to know which stock has a better risk-return profile. How would you answer her?
- Part B: Stock C has a standard deviation of 20% and a beta of 1.20. Stock D has a standard deviation of 16% and a beta of 1.44. A client wants to know which stock is riskier. How would you answer her?
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Personal Finance Turning Money into Wealth
Authors: Arthur J. Keown
8th edition
134730364, 978-0134730363
