In relation to the financial market, a statistical measure of the risk of a particular individual investment or portfolio. It is roughly calculated from the deviation of the individual respective returns from the average return – calculated according to various approaches – within a given period. High variance means high risk (a statistical tool measuring the dispersion of a variable from its mean. Variance commonly is calculated as equal to the sum of the squares of the deviation of each return from expected outcome, weighted by the likelihood of each of the possible returns occurring. Applied to financial profitability, variance measures the risk of a financial security). – See leverage theory, yield spread, Sharpe ratio, value at risk, volatility.

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk
https://www.jung-stilling-gesellschaft.de/merk/
https://www.gerhardmerk.de/

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