You’ve observed the following returns on Doyscher Corporation’s stock over the p

Question

You’ve observed the following returns on Doyscher Corporation’s stock over the past five years: –27.0 percent, 15.0 percent, 33.0 percent, 3.0 percent, and 22.0 percent.

What was the variance of the returns over this period? (Do not round intermediate calculations. Round your answer to 6 decimal places (e.g., 32.161616).)

What was the standard deviation of the returns over this period? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

You’ve observed the following returns on Doyscher Corporation’s stock over the past five years: –27.0 percent, 15.0 percent, 33.0 percent, 3.0 percent, and 22.0 percent.

Explanation / Answer

a) Variance is the square of Standard Deviation or rather the amount which is considered for taking the square root in the following sub answer.

Variance = 447.64

b) Standard Deviation is calculated as follows

Calculate the mean of the numbers : (-27+15+33+3+22) / 5 = 9.2

Subtract all the numbers from the mean and sguare those numbers =(-27-9.2)^2 + (15-9.2)^2 + (33-9.2)^2 + (3-9.2)^2 + (22-9.2)^2 = 2238.2

Take the mean of the above number = 2238.2 / 5 = 447.64

Take the square root of the above number which gives the Standard deviation = 21.16

Note- rounding off difference may vary according to calculators

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