In a question:
Expected Return = 18%
Standard Deviation = 11%
Coefficient of Variation = 61.111 %
Coefficient of Variation is a relative measure of risk. Since it is expressed as a percentage of return.
Isn’t Standard Deviation also a relative measure of risk – expressed as a percentage of return?
I came onto that conclusion as ‘ on a return of Rs. 100 we can expect volatility of Rs.11 implying that on an average we can earn 100 – 11 = 88 or 100 + 11 = 111’
Please correct me if I am mistaken.