Decile

AAA

DEFINITION of 'Decile'

A method of splitting up a set of ranked data into 10 equally large subsections. This type of data ranking is performed as part of many academic and statistical studies in the finance field. The data may be ranked from largest to smallest values, or vice versa.

INVESTOPEDIA EXPLAINS 'Decile'

When an analyst or statistician ranks data and then splits them into deciles, it is in an attempt to discover the largest and smallest values by a given metric. For example, by splitting the entire S&P 500 Index into deciles (50 firms will be in each decile) by the P/E multiple, the analyst will discover the companies with the highest and lowest P/E valuations in the index.

RELATED TERMS
  1. Dogs Of The Dow

    An investing strategy that consists of buying the 10 DJIA stocks ...
  2. Price-Earnings Ratio - P/E Ratio

    A valuation ratio of a company's current share price compared ...
  3. Standard & Poor's 500 Index - S&P ...

    An index of 500 stocks chosen for market size, liquidity and ...
  4. Price-Earnings Relative

    A price-earnings ratio of a stock divided by the price-earnings ...
  5. Analyst

    A financial professional who has expertise in evaluating investments ...
  6. Compound Annual Growth Rate - CAGR

    The year-over-year growth rate of an investment over a specified ...
RELATED FAQS
  1. Where can I find historical stock/index quotes?

    There is no shortage of internet sites that provide current stock quotes. Just about any large financial portal will let ... Read Full Answer >>
Related Articles
  1. Investing Basics

    What Is The Impact Of Research On Stock Prices?

    The answer to this question is directly related to the importance of information in the marketplace.
  2. Active Trading

    Data Mining For Investors

    Being an informed investor is extremely important, but where and how do you get the data for your research?
  3. Active Trading

    The Importance Of Segment Data

    Key financials often fail to provide insight into large cap companies.
  4. Fundamental Analysis

    What is a Null Hypothesis?

    In statistics, a null hypothesis is assumed true until proven otherwise.
  5. Investing

    How to Use Stratified Random Sampling

    Stratified random sampling is a technique best used with a sample population easily broken into distinct subgroups. Samples are then taken from each subgroup based on the ratio of the subgroup’s ...
  6. Fundamental Analysis

    Lognormal and Normal Distribution

    When and why do you use lognormal distribution or normal distribution for analyzing securities? Lognormal for stocks, normal for portfolio returns.
  7. Investing Basics

    Using Normal Distribution Formula To Optimize Your Portfolio

    Normal or bell curve distribution can be used in portfolio theory to help portfolio managers maximize return and minimize risk.
  8. Technical Indicators

    The Normal Distribution Table, Explained

    The normal distribution formula is based on two simple parameters - mean and standard deviation
  9. Economics

    Can Investors Trust Official Statistics?

    The official statistics in some countries need to be taken with a grain of salt. Find out why you should be skeptical.
  10. Investing Basics

    R-Squared

    Learn more about this statistical measurement used to represent movement between a security and its benchmark.

You May Also Like

Hot Definitions
  1. Asset Class

    A group of securities that exhibit similar characteristics, behave similarly in the marketplace, and are subject to the same ...
  2. Fiat Money

    Currency that a government has declared to be legal tender, but is not backed by a physical commodity. The value of fiat ...
  3. Interest Rate Risk

    The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between ...
  4. Income Effect

    In the context of economic theory, the income effect is the change in an individual's or economy's income and how that change ...
  5. Price-To-Sales Ratio - PSR

    A valuation ratio that compares a company’s stock price to its revenues. The price-to-sales ratio is an indicator of the ...
  6. Hurdle Rate

    The minimum rate of return on a project or investment required by a manager or investor. In order to compensate for risk, ...
Trading Center