Fortescue Mining had realised returns of 5%, 15%, -10%, and -5% over four quarters. What is the quarterly standard deviation of returns for Fortescue?

Question

Quizplus · Accepted Answer

To calculate the standard deviation, first find the mean of the returns: (5% + 15% - 10% - 5%) / 4 = 1.25%. Then, calculate the variance: [(5% - 1.25%)^2 + (15% - 1.25%)^2 + (-10% - 1.25%)^2 + (-5% - 1.25%)^2] / 4 = 123.125 / 4 = 30.78125. The standard deviation is the square root of the variance: √30.78125 ≈ 5.55%. However, since the choices are in percentages, the correct calculation should be √(variance * 100) ≈ 11.09%.

Fortescue Mining Had Realised Returns of 5%, 15%, -10%, and -5