A financial analyst is comparing the annual returns of two investment portfolios, Portfolio A and Portfolio B, over a 10-year period.
Portfolio A: The annual returns were consistently close to the average, with very few years showing extreme gains or losses.
Portfolio B: The annual returns varied significantly from year to year, experiencing both very high gains and very significant losses.
Based on this description, which statement best compares the standard deviations of the annual returns for these two portfolios?
The standard deviation of the annual returns for Portfolio A is less than the standard deviation of the annual returns for Portfolio B.
The standard deviation of the annual returns for Portfolio A is equal to the standard deviation of the annual returns for Portfolio B.
The standard deviation of the annual returns for Portfolio A is greater than the standard deviation of the annual returns for Portfolio B.
There is not enough information to compare these standard deviations.
