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What is the relationship between the standard deviation of and the return on a security?

What is the relationship between the standard deviation of and the return on a security?
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Standard deviation- It is the measure of risk. Standard deviation is used widely as a measure of risk in portfolio management. Standard deviation of a portfolio return measures the variability of the expected return of the portfolio. It has three important factors:

  1. Proportion of securities in the portfolio
  2. Standard deviation of return of each security in the portfolio
  3. Co variance of return between each pair of securities in the portfolio.

Relationship between the standard deviation of and the return on a security- Standard deviation calculates how much the investment return deviates from the mean of the probability distribution of investments.

Higher the standard deviation, higher will be the volatility in return on the security.

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