Consider the use of a probability analysis in estimating returns and determining the standard deviation

Consider the use of a probability analysis in estimating returns and determining the standard deviation

Consider the use of a probability analysis in estimating returns and determining the standard deviation. You may use a hypothetical situation and do the calculations or just describe the steps in the process.

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Probability analysis is a technique used by risk managers to predict future events or expected returns such as business losses. It involves the evaluation of historical data to calculate the probability distribution which would be used to predict future outcomes. Standard deviation uses probability to measure the volatility…………………….