[CamperBob2]

   A stock (or a fund) has an average return of 0%. It moves 
   on average 1% a day in absolute value; the average up move 
   is 1% and the average down move is 1%.

How does that yield an average return of 0%?

[baking]

The usual way to do this is to take the natural log, so an up 1% day followed by a down 1% day (or vice versa) will always net out to a 0% change.

[MaysonL]

It goes up a little more often than it goes down?