According to Table 6‐6, the standard deviation for all common stocks for the period 1926–2010 was 19.9 percent. Using data from Table 6‐1, calculate the standard deviation for the years 1981–1991 and compare your results.

Table 6‐6

Table 6‐1 

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TABLE 6-6 Summary Statistics of Annual Returns for Major Financial Assets for 85 Years, January 1, 1926-December 31, 2010 Returns summary S&P 500 Composite Aaa Corporate Bond US Treasury Bond Treasury bill Inflation Arithmetic Mean 11.5% 6.3 5.8 3.7 3.1 Std. Dev. 19.9% 8.5 9.2 3.0 4.2 Geometric Mean 9.6% 5.9 5.4 3.6 3.0