DEFINITION of 'Conditional Probability'
Probability of an event or outcome based on the occurrence of a previous event or outcome. Conditional probability is calculated by multiplying the probability of the preceding event by the updated probability of the succeeding event.
BREAKING DOWN 'Conditional Probability'
Conditional probabilities are contingent on a previous result. For example, suppose you are drawing three marbles  red, blue and green  from a bag. Each marble has an equal chance of being drawn. What is the conditional probability of drawing the red marble after already drawing the blue one? First, the probability of drawing a blue marble is about 33% because it is one possible outcome out of three. Assuming this first event occurs, there will be two marbles remaining, with each having a 50% of being drawn. So, the chance of drawing a blue marble after already drawing a red marble would be about 16.5% (33% x 50%).

Unconditional Probability
The probability that an event will occur, not contingent on any ... 
Addition Rule For Probabilities
A statistical property that states the probability of one and/or ... 
Prior Probability
The probability that an event will reflect established beliefs ... 
Compound Probability
A mathematical term relating to the likeliness of two independent ... 
Joint Probability
A statistical measure where the likelihood of two events occurring ... 
Expected Value
Anticipated value for a given investment. In statistics and probability ...

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Basic Probability Concepts
CFA Level 1  Probability Concepts  Basics. Discusses randomness and various types of probabilities. 
Fundamental Analysis
Scenario Analysis Provides Glimpse Of Portfolio Potential
This statistical method estimates how far a stock might fall in a worstcase scenario. 
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Scenario / WhatIf Analysis
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Professionals
Joint Probability
CFA Level 1  Probability Concepts  Joint Probability 
Forex Education
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This method can help refine probability estimates using an intuitive process. 
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Common Probability Distributions
CFA Level 1  Common Probability Distributions  Basics 
Term
Estimating with Subjective Probability
Subjective probability is someone’s estimation that an event will occur. 
Term
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In statistics, mutually exclusive situations involve the occurrence of one event that does not influence or cause another event. 
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This decisionmaking tool integrates the idea that every decision has an impact on overall risk. 
Fundamental Analysis
Explaining Expected Return
The expected return is a tool used to determine whether or not an investment has a positive or negative average net outcome.

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