A sot's return has the following distribution:
Demand for the Probability of this Rate of Return
Company's Products Demand Occurring if This Demand Occurs
Weak 0.1 (50%)
Below average 0.2 (5)
Average 0.4 16
Above average 0.2 25
Strong 0.1 60
Calculate the stock's expected return, standard deviation and coefficient of variation.
ř = 11.40%
σ = 26.69 %
I would like to see the work and steps with the formula, Thanks© BrainMass Inc. brainmass.com June 3, 2020, 8:45 pm ad1c9bdddf
Expected return = Sum (Probability X return)
Expected return = 0.1X-50% + 0.2X-5%+0.4X16%+0.2X25%+0.1X60%
Expected return = ...
The solution explains how to calculate the expected return, standard deviation and coefficient of variation.