Liz Chapa manages a portfolio of 250 common stocks. Her staff compiled the following performance statistics for two new stocks: The coefficient of variation for Salas Products, Inc. is ___.

Question

Liz Chapa manages a portfolio of 250 common stocks. Her staff compiled the following performance statistics for two new stocks:  The coefficient of variation for Salas Products, Inc. is ___.

Quizplus · Accepted Answer

The coefficient of variation (CV) is calculated by dividing the standard deviation of a stock's returns by its mean return, and then multiplying by 100%. For Salas Products, Inc., the CV would be (15%/45%)*100%, which simplifies to 33%. Therefore, the correct answer is C) 33%. The other answer choices are either too high or too low, based on the given statistics.

Liz Chapa Manages a Portfolio of 250 Common Stocks