DEFINITION of 'Poisson Distribution'
A statistical distribution showing the frequency probability of specific events when the average probability of a single occurrence is known. The Poisson distribution is a discrete function.
INVESTOPEDIA EXPLAINS 'Poisson Distribution'
For example, if the average number of people that rent movies on a friday night at a single video store location is 400, a Poisson distribution can answer such questions as, "What is the probability that more than 600 people will rent movies?" Therefore, application of the Poisson distribution enables managers to introduce optimal scheduling systems. One of the most famous historical practical uses of the Poisson distribution was estimating the annual number of Prussian cavalry soldiers killed due to horsekicks. Other modern examples include estimating the number of car crashes in a city of a given size; in physiology, this distribution is often used to calculate the probabilistic frequencies of different types of neurotransmitter secretions.

Discrete Distribution
The statistical or probabilistic properties of observable (either ... 
Statistics
A type of mathematical analysis involving the use of quantified ... 
Frequency Distribution
A representation, either in a graphical or tabular format, which ... 
LogNormal Distribution
A statistical distribution of random variables which have a normally ... 
Heteroskedastic
A measure in statistics that refers to the variance of errors ... 
Random Walk Theory
The theory that stock price changes have the same distribution ...

What is a "linear" exposure in Value at Risk (VaR) calculation?
A linear exposure in the valueatrisk, or VaR, calculation is represented by positions in stocks, bonds, commodities or ... Read Full Answer >> 
How does the risk of investing in the aerospace sector compare to the broader market?
Investing in the aerospace sector is riskier than investing in the broader market. The most accurate measure of sector volatility, ... Read Full Answer >> 
What is the criteria for a simple random sample?
Simple random sampling is the most basic form of sampling and can be a component of more precise, more complex sampling methods. ... Read Full Answer >> 
What are some examples of ways that sensitivity analysis can be used?
Sensitivity analysis is an analysis method that is used to identify how much variations in the input values for a given variable ... Read Full Answer >> 
How does a pension income drawdown work?
While there are similar drawdown plans in the United States, a pension income drawdown plan most commonly refers to a specific ... Read Full Answer >> 
What is the most important section in an investment company's prospectus?
It is important for investors to examine all information contained within an investment company’s prospectus. However, the ... Read Full Answer >>

Budgeting
8 Tips To Help You Control Holiday Spending
These tips will have you singing "Joy to the World" well into the New Year. 
Fundamental Analysis
Financial Markets: Random, Cyclical Or Both?
Are the markets random or cyclical? It depends on who you ask. Here, we go over both sides of the argument. 
Entrepreneurship
Female CEOs Who Climbed The Corporate Ladder
These women climbed the ladder and broke the glass ceiling. 
Professionals
Traditional MBA Or Business Graduate Degree?
Though an MBA is the most popular business graduate degree, there may be other options more suited to your goals. 
Economics
How Does The Economy Affect House Size?
The better the economy, the bigger the house. But beware  everything that glitters isn't gold. 
Mutual Funds & ETFs
Top 4 ETFs That Will Help Diversify Your Portfolio
Seeking low cost diversification to high quality stocks and bonds? Consider these 4 ETFs. 
Bonds & Fixed Income
Muni Bonds, Taxable Bonds or CDs: Which is Best?
Here's how to tell if municipal bonds are a better investment than taxable bonds or CDs. 
Mutual Funds & ETFs
Mutual Funds or ETFs: Which is Better?
Trying to decide between a mutual fund or ETF? Here's what you need to know. 
Investing
The Strong Dollar’s (Real) Toll On Tech Stocks
A large portion of U.S. technology companies’ sales occur overseas, given the strong international business and consumer demand from many U.S. tech firms. 
Fundamental Analysis
How to Calculate a Coverage Ratio
In broad terms, the higher the coverage ratio, the better the ability of the enterprise to fulfill its obligations to its lenders.