Asymmetrical Distribution


DEFINITION of 'Asymmetrical Distribution'

A situation in which the values of variables occur at irregular frequencies and the mean, median and mode occur at different points. An asymmetric distribution is said to exhibit skewness. In contrast, a symmetric or normal distribution, when depicted on a graph, is shaped like a bell curve and the two sides of the graph are symmetrical.

BREAKING DOWN 'Asymmetrical Distribution'

Investment return data commonly has an asymmetric distribution. This occurs because investment performance is often skewed since investments experience periods of abnormally high and abnormally low performance, and because sample investment performance data are always changing. Investors should consider all of these factors when attempting to gauge investment volatility by using the standard deviation.

  1. Contract Theory

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  2. Symmetrical Distribution

    A situation in which the values of variables occur at regular ...
  3. Discrete Distribution

    The statistical or probabilistic properties of observable (either ...
  4. Poisson Distribution

    A statistical distribution showing the frequency probability ...
  5. Skewness

    Describe asymmetry from the normal distribution in a set of statistical ...
  6. Mean Reversion

    A theory suggesting that prices and returns eventually move back ...
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