Calculate the expected rate of return ry for stock y rxnbsp

Question

Expected returns

Stocks X and Y have the following probability distributions of expected future returns:

Probability	X	Y
0.2	-6%	-20%
0.2	4	0
0.3	13	21
0.2	19	27
0.1	39	42

1. Calculate the expected rate of return, r_Y, for Stock Y (r_X = 11.20%.) Round your answer to two decimal places. %
2. Calculate the standard deviation of expected returns, σ_X, for Stock X (σ_Y = 19.82%.) Round your answer to two decimal places. %
3. Now calculate the coefficient of variation for Stock Y. Round your answer to two decimal places.