Which set of characteristics should you prefer in a stock if you desire the highest (least negative)rate of return assuming that you will earn a negative total return for the period?
A)High-dividend,high standard deviation
B)No dividend,high standard deviation
C)High-dividend,low standard deviation
D)Low-dividend,high standard deviation
E)Low-dividend,low standard deviation

Question

Quizplus · Accepted Answer

In times of negative total return periods, stocks with high dividends and low standard deviation are preferred as they provide a steady income while having a lower risk of price fluctuation. High dividends indicate a strong financial position of the company and the low standard deviation implies a lower risk of price fluctuation, which is beneficial during a period of negative returns.

Which Set of Characteristics Should You Prefer in a Stock