As a financial advisor, you are assigned a new client who is considering investing in one of two stocks, A or B.
The table below shows information about the performance of stocks A and B last year.
| Return | Standard Deviation | |
| Stock A | 15 % | 8.3% |
| Stock B | 14% | 2.1% |
- As a financial advisor, are there factors other than return and risk that should be considered in making this decision?
- Based on these factors, what stock would you recommend to the client?
- What reasons will you convey to your client to justify your decision in recommending this stock?
- How will this recommendation impact the client?As a financial advisor, you are assigned a new client who is considering investing in one of two stocks, A or B.
The table below shows information about the performance of stocks A and B last year.
Return Standard Deviation Stock A 15 % 8.3% Stock B 14% 2.1% - As a financial advisor, are there factors other than return and risk that should be considered in making this decision?
- Based on these factors, what stock would you recommend to the client?
- What reasons will you convey to your client to justify your decision in recommending this stock?
- How will this recommendation impact the client?
