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Probability & Expected Return

How is the probability and expected return calculated on a single stock?

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Please see the details as below.

Expected return is the mean (average) of the probability distribution of the returns. There are various methods to calculate the expected return. Let us look at the following example.

Returns from a stock (%) Probability
10 0.1
13 ...

Solution Summary

solution describes how to calculate probability and expected return on a single stock.