Standard DeviationRealized1031.com2020-07-05 08:00:00
The standard deviation is a measure of volatility. It is commonly used to measure the volatility of investments (i.e., stocks). Volatility is associated with the riskiness of an investment. The higher an investment’s volatility, the higher its risk and vice versa. Investors generally prefer lower risk (lower volatility) investments. The standard deviation is a statistical measure of dispersion relative to the mean. It can be calculated by taking the square of variance based on each data point relative to the mean. To perform the calculation step-by-step for a stock, add up its returns across a period of time (i.e., monthly returns across 6 months) and divide by the number of observations to get the historical return. Subtract those returns from the average, square them, and add up those results. Now divide that sum by the number of observations minus one. Finally, take the square root of the last result to get the standard deviation.
Download The Guidebook To IPWM
Learn More About How Investment Property Wealth Management works.
Realized1031.com is a website operated by Realized Technologies, LLC, a wholly owned subsidiary of Realized Holdings, Inc. (“Realized”). Securities offered on this website are offered exclusively through Thornhill Securities, Inc., a registered broker/dealer and member of FINRA/SIPC("Thornhill"). Investment advisory services are offered through Thornhill Securities, Inc. a registered investment adviser. Thornhill Securities, Inc. is a subsidiary of Realized. Check the background of this firm on FINRA's BrokerCheck.
Realized does not provide tax or legal advice. Tax topics discussed are for educational purposes only and are not a substitute for professional tax advice. You should discuss your personal situation with a tax or legal professional.
Hypothetical example(s) are for illustrative purposes only and are not intended to represent the past or future performance of any specific investment.
Investing in alternative assets involves higher risks than traditional investments and is suitable only for sophisticated investors. Alternative investments are often sold by prospectus that discloses all risks, fees, and expenses. They are not tax efficient and an investor should consult with his/her tax advisor prior to investing. Alternative investments have higher fees than traditional investments and they may also be highly leveraged and engage in speculative investment techniques, which can magnify the potential for investment loss or gain and should not be deemed a complete investment program. The value of the investment may fall as well as rise and investors may get back less than they invested.
This site is published for residents of the United States who are accredited investors only. Registered Representatives and Investment Advisor Representatives may only conduct business with residents of the states and jurisdictions in which they are properly registered. Therefore, a response to a request for information may be delayed until appropriate registration is obtained or exemption from registration is determined. Not all of the services referenced on this site are available in every state and through every representative listed. For additional information, please contact 877-797-1031 or firstname.lastname@example.org.