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What is coefficient of variation?

What is coefficient of variation?

A coefficient of Variation is a statistical measure of expected return relative to the amount of risk assumed.

It’s also known as “relative standard deviation,” which makes sense since that implies that your expected risk is adjusted based on the expected return. You can easily calculate the Coefficient of Variation by dividing the standard deviation of the security by its expected return.

Keywords: risk, standard deviation, expected return, coefficient of variation,