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You tell your mom about your decision to purchase $XYZ. She tells you that $ABC is a better stock to buy because $ABC has yearly
You tell your mom about your decision to purchase $XYZ. She tells you that $ABC is a better stock to buy because $ABC has yearly returns of 16% and $XYZ is only 14%. You looked at both of the stocks and find that over the last 3 years, they have returned the following yields: XYZ:13%,15%,14%(AVG:14%)1%1%0%=(1+1+0)/3=.7%ABC:21%,5%,22%(AVG:16%)5%11%16%=(5+11+16)/3=10.7% - Which stock is "better" and why
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