What is the probability to survive

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Stock return r_stock is either +2500% or -100% with equal probabilities. Find:

E[r_stock] =

Var[r_stock] =

std_stock=

Is such stock attractive? Would you like to invest everything in this stock?

What is the probability to survive after 2 periods of investing ALL your wealth into it?

How should one approach instruments like that?

Reference no: EM132478070

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