The annual retums on a portfolio over each ofthe last four years were 50%, 30%,-25%, and -15%. The average log retum is closest to:
A. 5.44%.
B. 5.59%.
C. 8.56%.
D. 10.00%.
Answer:A
Zp = [ln( 1.50)+ In(1.30)+ In(0.75)+ In(0.85)]/4 = 5.44%