17. Average Return and Standard Deviation. In a recent 5-year period, mutual fund manager Diana Sauros produced the following percentage rates of return for the Mesozoic Fund. Rates of return on the market index are given for comparison. Calculate (a) the average return on both the fund and the index and (b) the standard deviation of the returns on each. Did Ms. Sauros do better or worse than the market index on these measures? (LO11-3) 1 3 4 Fund -1.2 +24.8 +40.7 +11.1 +0.3 Market index -0.9 +16.0 +31.7 +10.9 -0.7
17. Average Return and Standard Deviation. In a recent 5-year period, mutual fund manager Diana Sauros produced the following percentage rates of return for the Mesozoic Fund. Rates of return on the market index are given for comparison. Calculate (a) the average return on both the fund and the index and (b) the standard deviation of the returns on each. Did Ms. Sauros do better or worse than the market index on these measures? (LO11-3) 1 3 4 Fund -1.2 +24.8 +40.7 +11.1 +0.3 Market index -0.9 +16.0 +31.7 +10.9 -0.7
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Transcribed Image Text:17. Average Return and Standard Deviation. In a recent 5-year period, mutual fund manager Diana
Sauros produced the following percentage rates of return for the Mesozoic Fund. Rates of return on
the market index are given for comparison. Calculate (a) the average return on both the fund and
the index and (b) the standard deviation of the returns on each. Did Ms. Sauros do better or worse
than the market index on these measures? (L011-3)
1
2
3
4
5
Fund
- 1.2
+24.8
+40.7
+11.1
+0.3
Market index
-0.9 +16.0
+31.7
+10.9
-0.7
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Risk and return both are important factors for taking any investment decision. Return means earn an additional amount over the invested amount and risk means possibility of loss of invested amount.
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