Calculate the Standard Deviation of a Portfolio

By Stock Research Pro • September 23rd, 2009

Standard deviation is a term used in probability theory and statistics to measure the variability of a set of data. A low standard deviation means that the data points tend to assemble close to the mean while a high standard deviation indicates that the data tends to spread out over a larger range. In finance, the standard deviation can help analyze annual investment returns to measure volatility associated with an investment or across a portfolio.

Standard Deviation v. Expected Return

While the standard deviation is calculated to help an investor measure investment or portfolio volatility, expected return is computed by inputting the weighted average of the expected returns of each individual investment within the portfolio. In other words, the expected return represents the average of the probability distribution.

Click here to launch the Stock Research Pro Expected Return Calculator

To Use the Stock Research Pro Portfolio
Standard Deviation Calculator

(1) Enter the Investment Year in the Year column
(2) Enter the annual returns associated with each investment
(3) Enter the percentage that each investment makes up of the overall portfolio (in the lower box)

The standard deviation of the portfolio calculates automatically.


The above information is educational and should not be interpreted as financial advice. For advice that is specific to your circumstances, you should consult a financial or tax advisor.

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By Basil apostolou on October 18th, 2009 at

Good work, very simple & easy to use.
May I suggest that you expand the number of years to 10 and the number of investments to 12.

Basil Apostolou
Toledo, OH USA


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