Business, 30.05.2021 22:20 reneecoutinho10

The risk of an investment is measured by the variability of the changes in its value over a fixed period, such as a year. More variation from year to year means more risk. The government's Securities and Exchange Commission wants to require mutual funds to tell investors how risky they are. A news article (New York Times, April 2, 1995) says that some people think that "the proposed risk descriptions, especially one that goes by the daunting name standard deviation" are hard to understand. Explain to a friend what the standard deviation means, using the fact that the changes in a mutual fund's value over many years have a roughly Normal distribution.

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