Sample

What is a 'Sample'

A sample is a subset containing the characteristics of a larger population. Samples are used in statistical testing when population sizes are too large for the test to include all possible members or observations. A sample should represent the whole population and not reflect bias toward a specific attribute.

BREAKING DOWN 'Sample'

A sample is a smaller, manageable version of a larger group. For example, if you wanted to test an investment strategy on past stock data, you would have an enormous number of stocks to test. Instead of testing the strategy on every stock, you would use a sample, which allows you to draw statistical insights from a smaller group of stocks. The sample should not contain any bias, such as the survivorship bias, where you might only use stocks that have survived the entire length of time you wish to test. Choosing a sample randomly should eliminate the possibilities of bias.

RELATED TERMS
  1. Sampling

    A process used in statistical analysis in which a predetermined ...
  2. Representative Sample

    A subset of a statistical population that accurately reflects ...
  3. Sampling Error

    A statistical error to which an analyst exposes a model simply ...
  4. Sampling Distribution

    A probability distribution of a statistic obtained through a ...
  5. Systematic Sampling

    A type of probability sampling method in which sample members ...
  6. Simple Random Sample

    A subset of a statistical population in which each member of ...
Related Articles
  1. Markets

    How Does Sampling Work?

    Sampling is a term used in statistics that describes methods of selecting a pre-defined representative number of data from a larger data population.
  2. Markets

    What is Systematic Sampling?

    Systematic sampling is similar to random sampling, but it uses a pattern for the selection of the sample.
  3. Markets

    What is a Representative Sample?

    In statistics, a representative sample accurately represents the make-up of various subgroups in an entire data pool.
  4. Investing

    Explaining Standard Error

    Standard error is a statistical term that measures the accuracy with which a sample represents a population.
  5. Markets

    Understanding the Simple Random Sample

    A simple random sample is a subset of a statistical population in which each member of the subset has an equal probability of being chosen.
  6. Markets

    Explaining the Central Limit Theorem

    Central limit theorem is a fundamental concept in probability theory.
  7. Markets

    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 ...
  8. Retirement

    Birch Box Review: Is It Worth It?

    Learn more about the convenience of the subscription beauty box industry, and discover why the Birchbox company in particular has become so popular.
  9. Trading

    Hypothesis Testing in Finance: Concept & Examples

    When you're indecisive about an investment, the best way to keep a cool head might be test various hypotheses using the most relevant statistics.
  10. Trading

    Understanding Statistics

    Statistics provide the means to analyze data and then summarize it into a numerical form.
RELATED FAQS
  1. How can a representative sample lead to sampling bias?

    Learn how using representative samples alone is not enough to make sampling bias negligible and why elements such as randomization ... Read Answer >>
  2. What percentage of the population do you need in a representative sample?

    Learn about representative samples and how they are used in conjunction with other strategies to create useful data with ... Read Answer >>
  3. What's the difference between a representative sample and a convenience sample?

    Learn the difference between convenience sampling and representative sampling and the advantages and disadvantages of each ... Read Answer >>
  4. What's the difference between a representative sample and a random sample?

    Explore the differences between representative samples and random samples, and discover how they are often used in tandem ... Read Answer >>
  5. What is the difference between systematic sampling and cluster sampling?

    Learn about the differences between systematic sampling and cluster sampling, including how the samples are created for each ... Read Answer >>
  6. What's the difference between a representative sample and an unbiased sample?

    Discover how the different techniques used to select representative samples and unbiased samples are often exploited and ... Read Answer >>
Hot Definitions
  1. AAA

    The highest possible rating assigned to the bonds of an issuer by credit rating agencies. An issuer that is rated AAA has ...
  2. GBP

    The abbreviation for the British pound sterling, the official currency of the United Kingdom, the British Overseas Territories ...
  3. Diversification

    A risk management technique that mixes a wide variety of investments within a portfolio. The rationale behind this technique ...
  4. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
  5. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  6. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
Trading Center