What's the standard deviation of a portfolio with these individual rates of return and probability weights? In English, what does standard deviation mean/tell us?
We can find the standard deviation of stock using the following formula :-
standard deviation of stock =
This is demonstrated using the excel as follows :-
standard deviation of stock = = 11.24
probability weights may be taken as 2:3:4:1
In English, standard deviation means the deviation of the actual result from the standard.
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