The countries of Stabilato and Variato have the following average returns and standard deviations for their stocks, bond, and short-term government securities. What range of returns should you expect to earn 95 percent of the time for each asset class if you invested in Stabilato's securities? From investing in Variato's securities?
|
Stabilato Ass
|
Average Return
|
Standard
|
|
|
Sock
|
8%
|
3%
|
|
|
Bonds
|
5%
|
2%
|
|
|
Short-term government debt
|
3%
|
1%
|
|