QUESTION 36 Which statement about geormetric average or time-weighted return and the simple arithmetic return is correct? 1. Geometric average return is more consistent with the true buy-and-hold return one would get by investing in a stock 2. Geometric average reflects the fact that negative returns hurt investment performance more than positive returns improve investment performance 3. Stock A and B have the same arithmetic average return but different return volatility. Volatility of A> that of B. That means A is more likely to have both larger positive and negative return realizations than B. But because negative returns have a stronger effect on the total buy and hold return over the entire holding period, stock A will on average have a lower total return, determined by the volatility difference of the two stocks. 1,2,3 1 2 and 3 only but not 1 1,2 none is correct