Example 1: We have a stock (A) and we know that its return (R) can take only one of these four values. State Probability 1 0.1 2 0.2 3 0.2 RA 6% 7% 8% 9% 0.5 4 - 1.0 Find the expected value, variance, and standard deviation of the returns for stock A. Expected return E(RA): Variance (?): measures the dispersion of this random variable. Standard Deviation (.): is the square root of variance