Return and Risk Analysis

Question 1

What is income return?

Answer 1

Payments received from the investment

Question 2

What is standard deviation?

Answer 2

Standard deviation measures the amount of variability among the numbers in a data set

Question 3

What is expected return?

Answer 3

Average financial return for a period of time

Question 4

What is expected risk?

Answer 4

anticipated or forecasted level of potential loss associated with an investment

Question 5

What does high standard deviation mean?

Answer 5

Data is spread out (implication of increased risk)

Question 6

What does low standard deviation mean?

Answer 6

Data is clustered around the mean (implication of decreased risk)