Sampling

AAA

DEFINITION of 'Sampling'

A process used in statistical analysis in which a predetermined number of observations will be taken from a larger population. The methodology used to sample from a larger population will depend on the type of analysis being performed, but will include simple random sampling, systematic sampling and observational sampling.

The sample should be a representation of the general population.

INVESTOPEDIA EXPLAINS 'Sampling'

When taking a sample from a larger population, it is important to consider how the sample will be drawn. To get a representative sample, the sample must be drawn randomly and encompass the entire population. For example, a lottery system could be used to determine the average age of students in a University by sampling 10% of the student body, taking an equal number of students from each faculty.

VIDEO

Loading the player...
RELATED TERMS
  1. Control

    1. The use of power to influence an outcome. For example, working ...
  2. Central Limit Theorem - CLT

    A statistical theory that states that given a sufficiently large ...
  3. Sample

    A subset containing the characteristics of a larger population. ...
  4. Sampling Error

    A statistical error to which an analyst exposes a model simply ...
  5. Statistics

    A type of mathematical analysis involving the use of quantified ...
  6. Normal Distribution

    A probability distribution that plots all of its values in a ...
RELATED FAQS
  1. What are some common financial sampling methods?

    There are two areas in finance where sampling is very important: hypothesis testing and auditing. The type of sampling methods ... Read Full Answer >>
  2. What are the benefits of financial sampling?

    Financial sampling allows auditors to approximate the rate of error within financial statements. For accounting purposes, ... Read Full Answer >>
  3. 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 >>
  4. How can a representative sample lead to sampling bias?

    A representative sample, like any other type of sample, by its very nature leads to a degree of sampling bias, or sampling ... Read Full Answer >>
  5. What are the advantages of using a simple random sample to study a larger population?

    Simple random sampling is a method used to cull a smaller sample size from a larger population and use it to research and ... Read Full Answer >>
  6. What are the disadvantages of using a simple random sample to approximate a larger ...

    Simple random sampling statistically measures a subset of individuals selected from a larger group or population to approximate ... Read Full Answer >>
Related Articles
  1. Fundamental Analysis

    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

    Using Historical Volatility To Gauge Future Risk

    Use these calculations to uncover the risk involved in your investments.
  3. Retirement

    Consumer Confidence: A Killer Statistic

    The consumer confidence is key to any market economy, so investors need to learn the measures and how to analyze them.
  4. Mutual Funds & ETFs

    5 Ways To Measure Mutual Fund Risk

    These statistical measurements highlight how to mitigate risk and increase rewards.
  5. Active Trading

    Random Reinforcement: Why Most Traders Fail

    This phenomenon can cause a trader to abandon a proven strategy or risk everything on chance. Find out how to avoid it.
  6. Economics

    Explaining the Liquidity Coverage Ratio

    The liquidity coverage ratio requires banks and other financial institutions to hold enough cash and liquid assets on hand to weather market stress.
  7. Fundamental Analysis

    Calculating Valuation

    Valuation is the process of determining what an asset is worth.
  8. Economics

    Will the Selloff in China Hurt the Global Economy?

    Though China is the world’s second largest economy, its volatility in the stock market is unlikely to have an impact on the global or Chinese economy.
  9. Fundamental Analysis

    Understanding Qualitative Analysis

    Qualitative analysis is a general term describing the non-mathematical scrutiny used by investors and managers to make investment and business decisions.
  10. Economics

    Signs The U.S. Recovery Is Solid

    Many market observers lately have been making some pretty pessimistic evaluations of the U.S. economy, declaring that it’s stagnating and soft.

You May Also Like

Hot Definitions
  1. OsMA

    An abbreviation for Oscillator - Moving Average. OsMA is used in technical analysis to represent the variance between an ...
  2. Investopedia

    One of the best-known sources of financial information on the internet. Investopedia is a resource for investors, consumers ...
  3. Unfair Claims Practice

    The improper avoidance of a claim by an insurer or an attempt to reduce the size of the claim. By engaging in unfair claims ...
  4. Killer Bees

    An individual or firm that helps a company fend off a takeover attempt. A killer bee uses defensive strategies to keep an ...
  5. Sin Tax

    A state-sponsored tax that is added to products or services that are seen as vices, such as alcohol, tobacco and gambling. ...
  6. Grandfathered Activities

    Nonbank activities, some of which would normally not be permissible for bank holding companies and foreign banks in the United ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!