What is a 'Coefficient Of Variation  CV'
A coefficient of variation (CV) is a statistical measure of the dispersion of data points in a data series around the mean. It is calculated as follows:
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The coefficient of variation represents the ratio of the standard deviation to the mean, and it is a useful statistic for comparing the degree of variation from one data series to another, even if the means are drastically different from each other.
BREAKING DOWN 'Coefficient Of Variation  CV'
In the investing world, the coefficient of variation allows you to determine how much volatility (risk) you are assuming in comparison to the amount of return you can expect from your investment. In simple language, the lower the ratio of standard deviation to mean return, the better your riskreturn tradeoff.
Note that if the expected return in the denominator of the calculation is negative or zero, the ratio will not make sense.

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Which of the following statements is (are) true with respect to the coefficient ...
The correct answer is: c) (I) is incorrect because coefficient of determination will always be positive, whereas correlation ... Read Answer >> 
What can the coefficient of variation (COV) tell investors about an investment's ...
Learn what the coefficient of variation is, the formula used to calculate it and how investors use it to determine an investment's ... Read Answer >> 
What are some of the advantages of using coefficient of variation (COV)?
Learn some advantages of using coefficient of variation (COV). Find out how it is calculated, as well as how it can be used ... Read Answer >> 
What does a negative correlation coefficient mean?
Discover the meaning of a negative correlation coefficient, how this compares to other correlation coefficients and examples ... Read Answer >> 
What is the difference between a copay and a deductible?
Learn how the correlation coefficient may be used to predict the relationship between the returns of two stocks, but also ... Read Answer >> 
What does standard deviation measure in a portfolio?
Dig deeper into the investment uses of, and mathematical principles behind, standard deviation as a measurement of portfolio ... Read Answer >>