Standard deviation, standard deviation refers to the deviation between the monthly return of the fund and the average monthly return in the past period of time. The greater the monthly income fluctuation, the greater the standard deviation. For example, if the monthly return rate of Fund A in the past 36 months is 1%, then its standard deviation is 0. The monthly rate of return of fund B is constantly changing, 5% a month, 25% next month and -7% next month, so the standard deviation of fund B is greater than that of fund A, and the monthly loss of fund C is 1%, and its standard deviation is also 0. In fact, the standard deviation quantifies the fluctuation of portfolio income, not the risk in the portfolio, because the standard deviation does not reflect the downside risk of the fund, that is, the possibility of loss. Just like the above example, although the standard deviation of fund B is large, its risk is not necessarily greater than that of fund C. In other words, a fund with a large standard deviation may not have a downside risk, but its income fluctuates greatly. Therefore, we'd better take the standard deviation as an indicator to measure income fluctuation. The standard deviation of the fund should be compared with the standard deviation of the same type of fund or performance evaluation benchmark. Because simply looking at the absolute number of the standard deviation itself cannot directly explain its meaning. For example, the standard deviation of 7% is higher than 5%, but is this value high or low for a fund? Beta coefficient is a relative index, which measures the overall volatility of fund returns relative to performance evaluation benchmark returns. The higher the beta coefficient, the greater the volatility of the fund relative to the performance evaluation benchmark. If the β coefficient is greater than 1, the volatility of the fund is greater than that of the performance evaluation benchmark. Or conversely, when Dallas goes to the audience, if the beta coefficient is 1, the market will rise 10% and the fund will rise10%; The market fell 10%, and the fund fell accordingly 10%. If the beta coefficient is 1. 1 and the market rises 10%, the fund rises11%; When the market falls 10%, the fund falls 1 1%. If the beta coefficient is 0.9 and the market rises 10%, the fund will rise by 9%; When the market fell 10%, the fund fell by 9%. It is worth noting that whether beta coefficient can effectively measure risk is largely influenced by the correlation between fund and performance evaluation benchmark. If the fund is compared with an irrelevant performance evaluation benchmark, the calculated β coefficient is meaningless. Therefore, when examining the β coefficient, we should also examine another index-R square.