Calculating a company's financial variance can help with planning and budgeting in the future.

The following article will show you, step-by-step, how to calculate the historical variance of stock returns with a detailed example.

Variance is a measurement of the spread between numbers in a data set. Investors use the variance equation to evaluate a portfolio’s asset allocation.

Learn about how price and cost affect a company's gross profit margin and how variance can be calculated based on changes in these two variables.

The article How to Calculate Financial Variance When Budgeting for a Loss originally appeared on Fool.com. Try any of our Foolish newsletter services free for 30 days.