Nonparametric Method

DEFINITION of 'Nonparametric Method'

A method commonly used in statistics to model and analyze ordinal or nominal data with small sample sizes. Unlike parametric models, nonparametric models do not require the modeler to make any assumptions about the distribution of the population, and so are sometimes referred to as a distribution-free method.

BREAKING DOWN 'Nonparametric Method'

Typically, this method will be used when the data has an unknown distribution, is non-normal, or has a sample size so small that the central limit theorem can't be applied to assume the distribution.

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