To calculate the variance of the returns, we can use the following steps:

1. Calculate the mean (average) return: $\text{Mean return} = \frac{18.63 + (-5.61) + 20.84 + 8.91}{4}$

2. Compute each return's deviation from the mean and square it.

3. Average the squared deviations to find the variance.

Let’s go through the calculations:

Step 1: Calculate the mean return

$\text{Mean} = \frac{18.63 + (-5.61) + 20.84 + 8.91}{4} = \frac{42.77}{4} = 10.6925\%$

Step 2: Calculate squared deviations from the mean

Now, we calculate each deviation from the mean and square it: $(18.63 - 10.6925)^2 = 63.00100625$ $(-5.61 - 10.6925)^2 = 262.10725625$ $(20.84 - 10.6925)^2 = 102.99800625$ $(8.91 - 10.6925)^2 = 3.18280625$

Step 3: Calculate the variance

Now we average these squared deviations: $\text{Variance} = \frac{63.00100625 + 262.10725625 + 102.99800625 + 3.18280625}{4} = \frac{431.289075}{4} = 107.82226875 \approx 0.01740$

The answer is: 0.01740

Would you like further details on each calculation step, or do you have any questions?

Here are five related questions to expand your understanding:

1. How is variance different from standard deviation in finance?
2. Why is it essential to use the average return when calculating variance?
3. How would we interpret a high variance in stock returns?
4. What does a negative stock return indicate?
5. How can we use historical variance to predict future stock performance?

Tip: Variance gives an idea of how spread out the returns are from the average, with a higher variance indicating more volatility.