## What are 'Quintiles'

A quintile is a statistical value of a data set that represents 20% of a given population, so the first quintile represents the lowest fifth of the data (1% to 20%); the second quintile represents the second fifth (21% to 40%) and so on.

Quintiles are used to create cut-off points for a given population; a government-sponsored socio-economic study may use quintiles to determine the maximum wealth a family could possess in order to belong to the lowest quintile of society. This cut-off point can then be used as a prerequisite for a family to receive a special government subsidy aimed to help society's less fortunate.

Next Up

## BREAKING DOWN 'Quintiles'

A quintile is a type of quantile, which is defined as equal-sized segments of a population. One of the most common metrics in statistical analysis, the median, is actually just the result of dividing a population into two quantiles. A quintile is one of four values that divide a range of data into five equal parts, each being 1/5th (20 percent) of the range. A population split into three equal parts is divided into tertiles, while one split into fourths is divided into quartiles. The larger the data set, the easier it is to divide into greater quantiles. Economists often use quintiles to analyze very large data sets, such as the population of the United States.

For example, if we were to look at all of the closing prices for a specific stock for every day in the last year, the top 20% of those prices would represent the upper quintile of the data. The bottom 20% of those prices would represent the lower quintile of the data. There would be three quintiles in between the upper and lower quintiles. The average of all the stock prices typically falls between the second and fourth quintiles, which is the middle point of the data.

## Common Uses of Quintiles

Politicians invoke quintiles to illustrate the need for policy changes. For example, a politician who champions economic justice can divide the population into quintiles to illustrate how the top 20% of income earners controls what is, in his opinion, an unfairly large share of the wealth. On the other end of the spectrum, a politician calling for an end to progressive taxation might use quintiles to make the argument that the top 20% shoulder too large a share of the tax burden.

In "The Bell Curve," a controversial 1994 book on intelligence quotient (IQ), the authors use quintiles throughout the text to illustrate their research, showing that IQ is heavily correlated with positive outcomes in life.

## Alternatives to Quintiles

For certain populations, the use of other methods to examine how the data is distributed makes more sense than using quintiles. For smaller data sets, the use of quartiles or tertiles helps prevent the data from being spread too thin. Comparing the mean, or average, of a data set to its median, or the cutoff point where the data is divided into two quantiles, reveals if the data is evenly distributed or if it is skewed toward the top or bottom. A mean that is significantly higher than the median indicates the data is top-heavy, while a lower mean suggests the opposite.

RELATED TERMS
1. ### Quartile

A quartile is a statistical term describing a division of observations ...
2. ### Affluenza

Affluenza is a condition arising from the desire to be wealthy; ...
3. ### Cutoff Point

The cutoff point is the point at which an investor decides whether ...
4. ### Statistics

Statistics is a type of mathematical analysis involving the use ...
5. ### Working-age Population

The working-age population in a region is the range of ages considered ...
6. ### Data Science

Data science is a field of Big Data that seeks to provide meaningful ...
Related Articles
1. Retirement

### Is the Longevity Gap Helping the Rich Get Richer?

Researchers have found that longevity is why well-off American men collect more in government retirement benefits than their low-income peers.
2. Managing Wealth

### Americans Are Getting Richer...Kind Of

Americans are getting richer – the number of affluent households is growing – but the rate is slower now than it was before the Great Recession.
3. Taxes

### What's Wrong with the American Tax System

American's are highly taxed and we still run a deficit. We explain why.
4. Retirement

### How Social Security Will Change In 2015

The average retiree’s check will rise by 1.7% in 2015, the Social Security Administration says. And the ceiling on taxable earnings will rise, as well.
5. Investing

### LabCorp In Talks to Buy Contract Researcher PPD

LabCorp may acquire privately-held Pharmaceutical Product Development LLC.

### 3 Reasons to Invest in Asia's Emerging Markets

Emerging markets in Asia aren't on the rise at the moment, but they're best days are likely to be in the future. Here's why.

### Keep an Eye on These Emerging Economies

Emerging markets have been hammered lately, but these three countries (and their large and young populations) are worth monitoring.
8. Personal Finance

### Top Paying Math-Related Careers

These jobs require specialized math skills that intimidate most laymen. But, for those with the wit and work ethic to attain this knowledge, there are many high-paying employment options.
9. Tech

### Big Data in Financial Services Comes With Some Risks

Big data is playing a larger role in finance but its application does not come without risks.
10. Tech

### Financial Advisors' Next Big Tech Tool: Big Data

Here's how big data is playing a crucial role in the work life of financial advisors and some strategies on how to take advantage of the technology.
RELATED FAQS
1. ### What are the main income statement ratios?

Learn how to calculate and interpret some of the most common and insightful financial ratios, like earnings per share, from ... Read Answer >>
2. ### What are the pros and cons of stratified random sampling?

Stratified random sampling provides a more accurate sampling of a population, but can be disadvantageous when researchers ... Read Answer >>
3. ### What country has the wealthiest overall population?

Find out which country has the wealthiest overall population, based on per capita income. Discover how this wealth was created ... Read Answer >>
4. ### Does a stock split lead to the gapping up/down of the stock?

If a company splits its stock, there will be no gapping of the stock due to the split itself. A stock split does not materially ... Read Answer >>
5. ### How do you calculate variance in Excel?

To calculate statistical variance in Microsoft Excel, use the built-in Excel function VAR. Read Answer >>
6. ### What impact does a higher non-farm payroll have on the forex market?

The employment report, released by the Bureau of Labor Statistics, is an economic indicator that contains data on the employment ... Read Answer >>
Hot Definitions
1. ### Intrinsic Value

Intrinsic value is the perceived or calculated value of a company, including tangible and intangible factors, and may differ ...
2. ### Current Assets

Current assets is a balance sheet account that represents the value of all assets that can reasonably expected to be converted ...
3. ### Volatility

Volatility measures how much the price of a security, derivative, or index fluctuates.
4. ### Money Market

The money market is a segment of the financial market in which financial instruments with high liquidity and very short maturities ...
5. ### Cost of Debt

Cost of debt is the effective rate that a company pays on its current debt as part of its capital structure.
6. ### Depreciation

Depreciation is an accounting method of allocating the cost of a tangible asset over its useful life and is used to account ...