Question

You own a stock with an average return of 15 percent and a standard deviation of 15 percent. In any one given year, you have a 68 percent chance that you will not lose more than _____ percent nor earn more than ____ percent on this stock.

Answer 1

Answer:

0%

30%

Explanation:

Given:

Average return = 15%

Standard deviation = 15%

Computation:

On assuming 68% chance,

Lowest point  = Average return - Standard deviation  

Lowest point = 15% - 15%

Lowest point = 0%

Highest point  = Average return - Standard deviation

Highest point = 15% + 15%

 Highest point = 30%

Therefore, on 68%, Lowest point is 0% and highest point is 30%.