CFA Practice Question

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CFA Practice Question

What does the coefficient of variation (CV) generally lie between?
A. -1 and +1
B. 0% and infinity
C. It has unlimited values.
Explanation: Since mean can be negative or positive, the CV can be any value.

User Contributed Comments 4

User Comment
yanpz By definition, CV is a statistical representation of the precision of a test; the function is standard deviation/mean x 100%. So it doesn't have to be "expected return". If it's not "expected return", then mean is possible to be negative.
wollogo I agree fully, it is quite common to have negative returns meaning that CV will be negative.
padasalasunil i thought CV = std dev / (absolute(mean))
Procbaby1 (std dev of a distribution)/(mean or expected value)
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