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Home Dictionary D Discrete Distribution Discrete probability distribution counts events that have countable or final outcomes. This is in contrast to a continuous distribution, where the results can fall anywhere on the continuum. Common examples of a discrete distribution include the binomial distribution, the Poisson distribution, and the Bernoulli distribution. These distributions often include a statistical analysis of the “numbers” or “how many times” an event occurs. In finance, discrete distributions are used in valuing options and predicting market shocks or recessions. Anomaly
September 25, 2022 Anomalies are events that deviate from the predictions of economic or financial models and undermine the underlying assumptions of those models. Growth Curve
September 25, 2022 A growth curve shows the direction of some phenomena in time, in the past or in the future, or both. Uniform Distribution
September 25, 2022 Uniform distributions are probability distributions with equally likely outcomes. Chi Square Statistic
September 25, 2022 The chi-square statistic (χ2) is a measure of the difference between the observed and expected frequencies of the outcomes of a set of events or variables. Homoskedastic
September 25, 2022 Homoscedasticity occurs when the variance of the error term in the regression model is constant. Inverse Correlation
September 25, 2022 Inverse (or negative) correlation is when two variables in a data set are related so that when one of them is high, the other is low. Mode
September 25, 2022 In statistics, the mode is the most frequently observed value in a dataset. Nonlinear Regression
September 25, 2022 Both linear and non-linear regression predict Y responses from variable (or variables) X. Nonlinearity
September 25, 2022 Non-linearity is a mathematical term that describes a situation where the relationship between the independent variable and the dependent variable cannot be predicted along a straight line. Nonparametric Method
September 25, 2022 Non-parametric method - a section of statistics that does not assume that the data come from given models determined by a small number of parameters. Poisson Distribution
September 25, 2022 The Poisson distribution, named after the French mathematician Siméon Denis Poisson, can be used to estimate how many times an event can occur within “X” time periods. Posterior Probability
September 25, 2022 The posterior probability in Bayesian statistics is the revised or updated probability of an event occurring after new information has been taken into account. Robust
September 25, 2022 Robust models produce positive results despite changing market conditions. Smart Money
September 25, 2022 Smart money is capital placed on the market by institutional investors, market experts, central banks, funds and other financial professionals. Two-Way ANOVA
September 25, 2022 Two-way analysis of variance is an extension of one-way ANOVA (ANOVA), which shows the results of two independent variables on the dependent variable. Type I Error
September 25, 2022 Type I error occurs in hypothesis testing when the null hypothesis is rejected even though it is true and should not be rejected. Unconditional Probability
September 25, 2022 Unconditional probability reflects the probability that some event will occur without taking into account any other possible influences or previous results. Yield Variance
September 25, 2022 Output variance measures the difference between the actual output and the standard output of a product or manufacturing process. 90/10 Strategy
September 25, 2022 The 90/10 retirement investment strategy involves investing 90% of investment capital in low-cost S&P 500 index funds, and the remaining 10% in short-term government bonds. Accredited Investor
September 25, 2022 Accredited investors are persons classified by the SEC as qualified to invest in complex or complex types of securities. Annual Equivalent Rate (AER)
September 25, 2022 The annual equivalent rate (AER) is the actual interest rate on investments, loans or savings accounts that can be obtained after compounding interest. Annualize
September 25, 2022 An annual analysis can be used to predict the financial performance of an asset, security or company for the next year. Annualized Rate of Return
September 25, 2022 Annual rate of return is the process of determining the rate of return on an investment on an annual basis. Annualized Total Return
September 25, 2022 Annual total return is the geometric mean of the amount of money earned by an investment each year over a given period of time. Appreciation
September 25, 2022 Valuation is the increase in the value of an asset over time.