Wednesday, July 2, 2008

Standard deviation




Standard deviation is a statistical measurement of volatility.

It provides a good indication of volatility.It based on past data to measures the tendency of data to be spread out.

When looking at the historic returns of a mutual fund, standard deviation can be used to measure the variation of expected return that has taken place in the past giving a sense of range of performance that can be expected given different probabilities of return for the future.






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