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An asset has an average historical rate of return of 13.2 percent and a variance of .00972196. What range of returns would you expect to see approximately two/thirds of the time?





An asset has an average historical rate of return of 13.2 percent and a variance of.00972196. What range of returns would you expect to see approximately two-thirds of the time? (Bubble your answer below) 2ク
An asset has an average historical rate of return of 13.2 percent and a variance of.00972196. What range of returns would you expect to see approximately two-thirds of the time? (Bubble your answer below) 1.
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Answer #1
Standard deviation = 0.00972196^0.5 = 9.86%
For a normal distribution, two thirds of the times, the
returns would be between Mean+/-1*SD
So the returns would be between:
13.20%+9.86% = 23.06% and
13.20%-9.86% = 3.34%
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