Use the adjacent returns to solve for: 1 - Average return 2 - Variance 3- Standard Deviation 4- Geometric Average VAR(R)=0 = (R -R) Year Return 1 20% -6% 8% 14% 4% GAR = [(1 + R ) (1 + R ) ... x (1 + RM -1 T-1 HN345 2

Use the adjacent returns to solve for: 1 - Average return 2 - Variance 3 - Standard Deviation 4 - Geometric Average VAR(R)=2=T1i=1T(RiR)jGAR=[(1+R1)(1+R2)(1+RN]1/1