An asset had returns of 7.7,5.4,3.6,-4.2,and -1.3 percent,respectively,over the past five years.What is the variance of these returns?
A) 0.00173
B) 0.00184
C) 0.00216
D) 0.00240
E) 0.00259

Question

Quizplus · Accepted Answer

Mean = (0.077 + 0.054 + 0.036 - 0.042 - 0.013) / 5 = 0.0224 Var = [(0.077 - 0.0224)² + (0.054 - 0.0224)² + (0.036 - 0.0224)² + (-0.042 - 0.0224)² + (-0.013 - 0.0224)²] / (5 - 1) = 0.00240

An Asset Had Returns of 7