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How are the following used on a stand-alone and a portfolio basis?
1. Standard Deviation
2. Variance
3. Covariance
Step by step
Solved in 3 steps
- Explain correlation to your client. Calculate the estimated correlation between Blandy and Gourmange. Does this explain why the portfolio standard deviation was less than Blandys standard deviation?The appropriate measure of risk used in Sharpe's measure of portfolio evaluation is a. Range b. Variance c. Beta d. Standard deviationIs the portfolio risk the weighted average of the variance or covariance?
- Which of the following statements regarding standard deviation is TRUE: Group of answer choices A measure of the dispersion of a random variable The annualised volatility The square root of volatility Always expressed in %Which of the following measures the total risk of a portfolio? A. Standard Deviation B. Correlation Coefficient C. Beta D. Alphaa)define market risk. b)define delta-hedged position and describe delta hedging. c)describe gamma hedging and vega hedging. d)define and explain value at risk (VAR). e)describe the analytical (variance-covariance) method of calculating VAR, and discuss its advantages and disadvantages.
- 22. When determining the riskiness of a stand-alone instrument (not included in a portfolio), which of the following statistical measures apply? Group of answer choices Standard Deviation Variance Covariane CorrelationBeta is which of the following: A) standard deviation. B) total risk. C) Beta is the relationship which is between an investment's return, and the market return. D) unsystematic risk.What is the expected return on a two asset portfolio and what are its variance and standard deviation? Also, What is R squared?
- b. What is the variance of this portfolio? The standard deviation? Please show me all steps of the calculations.Which one of the following measures is relevant for assessing exposure to systematic risk? A. variance B. beta C. standard deviation D. theta E. alphathe variance of stock A is .004, the variance of the market .007 and the covariance between the two is .0026. what is the correlation coefficient?