Position, Distributions, and Data Displays

Percentiles and z-scores

The normal distribution

Frequency distributions and honest display

From description to inference

A fund's annual return sits at the 80th percentile of its peer group. What does that position mean?

A return of 15 percent comes from a distribution with mean 7 percent and standard deviation 8.8 percent. What is the z-score, and how should it be read?

Why are z-scores especially useful when comparing returns across different asset classes?

For a roughly normal return distribution with mean 7 percent and standard deviation 8.8 percent, what range should contain about 95 percent of annual outcomes?

Why do risk managers treat the normal distribution's predictions of extreme moves with suspicion?

Why is a bar chart with a value axis that starts at 50 instead of 0 considered dishonest for amounts data?

What one-letter term names the number of standard deviations an observation sits from the mean? Write the letter.

What two-word term names the symmetric bell-shaped distribution described by mean and standard deviation? Answer in lowercase.

What two-word term names the rule that about 68, 95, and 99.7 percent of normal data fall within one, two, and three standard deviations? Answer in lowercase.

What one-word term names the value below which a stated percentage of observations fall? Answer in lowercase.