4. Measurement / Quantification of Risk

4. Measurement / Quantification of Risk

    Coefficient of Variation (C.V.) is a simple and most widely used measure or risk.
    C.V = (σ/ X) x 100
    Where,
    σ= Standard deviation and X = Mean

    ∑(X-X)2
    Standard Deviation S.D. σ= --------------
    N
    Where,
    X = variable for which σ is estimating
    X = mean, N = number of observations
    Higher the C.V. higher will be the risk.

Last modified: Thursday, 14 June 2012, 10:40 AM