Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Standard Deviation
An investment must be evaluated on two dimensions - rate of return and risk. An investor cannot enjoy a high return without any exposure to risk. The higher the return, the higher is the risk involved and the lower the exposure to risk, the lower would be the return. Risk is defined as the chance of injury, damage or loss. Risk in investments is the chance of the actual returns realized being much lower than the expected returns.
The risk in an investment is normally measured by the variance or standard deviation in the returns from the mean or expected return. The idea is, the higher the value of dispersion (that is, variance or standard deviation), the higher is the risk. If all possible or actual returns lie close to the mean return, then the total risk in investment is less and the investor has an assurance that at least the mean rate of return will be earned on the investment.
The variance and standard deviation of returns from the share of Godavari Petrochemicals Limited may be calculated as under:
Rates of Return
Probability of Occurrence
Deviations from Expected Rate of Return
Squares of Deviation
Probability x Squares of Devation
(Xi)
(Pi)
30%
0.30
10.2
104.04
31.212
18%
0.50
-1.8
3.24
1.620
9%
0.20
-10.8
116.64
23.328
Total
56.160
Q. Working Capital as a Percentage of Total Assets? This approach of estimation of working capital requirement is based on the fact that the total assets of the firm arc consis
what is leverage
BSE-500 and Sectoral Indices On August 9, 1999, another new index was introduced in the market which was based on the data of 500 companies and designated as BSE-500 index. It
What is a marginal cost of capital schedule (MCC)? Is the schedule always a horizontal line? Explain. The marginal cost of capital schedule is a graphic representation of the
What are the Measures of growth Sales or market share Number of products or markets Employees Profit Number of retail stores
ICQ's designed to: Identify possible areas of weakness. Discover existence of internal controls. Questions are framed to highlight situations where: NO su
Factors of Importance of returns in any investment Importance of returns in any investment decision can be traced to the following factors: It enables investors to
Tests of controlor systems based auditing Tests to obtain audit evidence about effective operation of the accounting and internal control systems. It isn't concerned about deta
Cascade Water Company (CWC) currently has 30 000 shares of common stock outstanding, trading at a price of R42 per share. CWC also has 500 000 bonds outstanding that are currently
You deposit $500 today in a savings account that pays 3.5% interest, compounded annually. How much will your account be worth at the end of 25 years?
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd