9. Symmetry and Skewness in Return Distributions

j. explain skewness and the meaning of a positively or negatively skewed return distribution;

k. describe the relative locations of the mean, median, and mode for a unimodal, nonsymmetrical distribution;

l. explain measures of sample skewness and kurtosis;

If you see a dataset with a mean and variance that are identical, what can you assume about it? It is a normal distribution (symmetrical)

What is a positively skewed distribution? It is a set with large values to the right, in the positive direction - a long right tail

What is a negatively skewed distribution? A set with large values to the left, in the negative direction - a long left tail

For a right or left skewed distribution, which direction does the mean go vs the median? The mean will always follow the direction of skew because it is pulled that direction by large outliers