Question
You observe a portfolio for five years and determine that its average return is 11.6% and the standard deviation of its returns in 19.2%. Would
You observe a portfolio for five years and determine that its average return is 11.6% and the standard deviation of its returns in 19.2%. Would a 30% loss next year be outside the 95% confidence interval for this portfolio?
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Part 1 The low end of the 95% prediction interval is _____%??
(Enter your response as a percent rounded to one decimal place.)
Pick A,B,C, OR D
A. Yes, you can be confident that the portfolio will not lose more than 30% of its value next year. This is because the low end of the prediction interval is less than 30%.
B. No, you cannot be confident that the portfolio will not lose more than 30% of its value next year. This is because the low end of the prediction interval is greater than 30%.
C. No, you cannot be confident that the portfolio will not lose more than 30% of its value next year. This is because the low end of the prediction interval is less than 30%.
D. Yes, you can be confident that the portfolio will not lose more than 30% of its value next year. This is because the low end of the prediction interval is greater than 30%.
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