The coefficient of variation is a good measure of the amount of risk that an asset will contribute to a diversified portfolio of assets.

Question

Quizplus · Accepted Answer

The coefficient of variation (CV) measures the standard deviation of an asset's returns relative to its mean return. A higher CV indicates higher variability and risk. Therefore, the CV is a good measure of the amount of risk an asset will contribute to a diversified portfolio.

The Coefficient of Variation Is a Good Measure of the Amount