A Stock Has a Standard Deviation of Daily Returns of 1

question 30

Multiple Choice

A stock has a standard deviation of daily returns of 1 percent. It wants to determine the lower boundary of its probability distribution of returns, based on 1.65 standard deviations from the expected outcome. The stock's expected daily return is .2 percent. The lower boundary is

• A)- 1.45 percent.
• B)- 1.85 percent
• C)0 percent.
• D)- 1.65 percent.

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Definitions:

Bipolar Disorders

Mental health conditions characterized by significant mood swings, including emotional highs (mania or hypomania) and lows (depression).

Depressive Disorder

A psychological condition marked by a continuous low mood or a lack of enjoyment in usual activities, which greatly disrupts everyday functioning.

Anxiety Disorder

A category of mental health disorders characterized by feelings of anxiety and fear that interfere with daily activities.

Acute Stress

A short-term psychological and physiological response to an immediate perceived threat or challenge.