Investments Flashcards

1
Q

Standard deviation curve

A
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2
Q

Coefficient of variation

A

Compares two assets per unit of risk
Higher the CV the riskier the asset

CV = standard deviation / avg return

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3
Q

Risk adjusted return

A

Return / Risk (standard deviation)

Coefficient of Variation = Risk/ return

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4
Q

Coefficient of determination

A

Also known as R squared
Calculated by squaring correlation coefficient . If greater than .70 beta can be used as measure of risk. If less than use standard deviation

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