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Question
Consider the following realized annual returns:| Year End | Index Realized Return | Stock A Realized Return |
| 2000 | 23.6% | 46.3% |
| 2001 | 24.7% | 26.7% |
| 2002 | 30.5% | 86.9% |
| 2003 | 9.0% | 23.1% |
| 2004 | -2.0% | 0.2% |
| 2005 | -17.3% | -3.2% |
| 2006 | -24.3% | -27.0% |
| 2007 | 32.2% | 27.9% |
| 2008 | 4.4% | -5.1% |
| 2009 | 7.4% | -11.3% |
Suppose that you want to use the 10 year historical average return on the Index to forecast the expected future return on the Index. The standard error of your estimate of the expected return is closest to:
A) 19.4%
B) 3.8%
C) 6.2%
D) 1.95%
Answer
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Related questions
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