Standard deviation

The most widely used measure of dispersion of a frequency distribution introduced by K. Pearson (1893). It is equal to the positive square root of the variance. The standard deviation should not be confused with the root mean square deviation. The standard deviation measures the degree to which a fund´s return varied from its average return over a certain period in the past. The smaller the difference, the lower the standard deviation will be -- and the greater the degree of stability the fund provided over the period.