The Tighter the Probability Distribution of Its Expected Future Returns

question 81

True/False

The tighter the probability distribution of its expected future returns, the greater the risk of a given investment as measured by its standard deviation.

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Definitions:

Reimbursement

The process of compensating someone for an expense they have incurred.

Surety

A person or entity that takes responsibility for another's performance of an undertaking, such as fulfilling the terms of a contract.

Outlays

Expenditures or the amount of money expended in the course of conducting business or executing a project.

Collateral

Collateral refers to assets that a borrower offers to a lender to secure a loan. If the borrower defaults, the lender can seize the collateral to recover the loaned amount.