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how to calculate weighted average standard deviation. With a weighted portfolio standard deviation of 1048 you can expect your return to be 10 points higher or lower than the average when you hold these two investments. 3 Now we can calculate the weighted average by dividing the SSUMPRODUCT with the SUM of the weightage assigned.
W i are the weights. With a weighted portfolio standard deviation of 1048 you can expect your return to be 10 points higher or lower than the average when you hold these two investments. Weighted average is a type of an average that takes into account the relative importance of each value under consideration and is calculated by multiplying the respective weights in percentage terms with its corresponding value Weighted Average Formula W1X1 W2X2 WnXn Here w respective weight in percentage x value.
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See more linked questions. Weighted coefficient of variation. With samples we use n 1 in the formula because using n would give us a biased estimate that consistently underestimates variability. All we have to do is calculate the square root of the portfolio variance.