Suppose that G is a function of a stock price, S and time. Suppose that S
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Suppose that G is a function of a stock price, S and time. Suppose that σS and σG are the volatilities of S and G. Show that when the expected return of S increases by λσS, the growth rate of G increases by λσG, where λ is a constant.
Expected ReturnThe expected return is the profit or loss an investor anticipates on an investment that has known or anticipated rates of return (RoR). It is calculated by multiplying potential outcomes by the chances of them occurring and then totaling these...
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