Organising Visualising Dilisibing

Data

Was Rist
 Meet Ekron Tendency

Measure of Central tendency identify the

Centre or average of a data set

MEAN

In
knighted Geometti Harmonia
Arithmeki Mean
Mean Mean Mean
 Arithmetic Mean

I
as Simple
mean
Also known

Example You have calculated the

stock feturns for Xyz Corporation

over the last teat as 25 347

197 59 177 Given

this information estimate the

mean of the distribution of returns

Arithmetic Mean

25 34
11
1,9754 29.87
we
 6
5 io
4 Weighted Mean

Amount Invested Expected Returns

SBI
m
4000 10
I
TCS 56000 57 I
Toooo
Sin
Weighted Heights t Returns
un
Mean

ft
LIYE 1064,15
SBI Height 0 40

Tcs Weight o 60
9
Packise Question

A Portfolio Consist 50 Common

of
stocks 40 bonds 10 Cash

If the return on Common stocks

is 12 the return on bonds is

7 the return on Cash is It

What is the portfolio Retoon

01
CIA toff
0
0
0 3 9
 goods
tf Median

Median is the mid a data

point of
set when data is
arranged in

ascending of descending order

watFI
41
11 2522
2nd observation II
L
2 1
Q What is the median return

for five Portfolio managers with

a lo teat annualized total tetons

record of 30 15 25 21

231
Median
I 151 211 75251 301

5 3rd observation
21 1
is median

odd
I find the median

301 287 257 237 217

1st

25
15 21
2 28 30

t 1
t
6 23

yobs
 The median is important because
the arithmetic mean can be affected

by extremely large Small Values

It
or

outliers

When this happen the median is

better measure of central tendency

than the mean

 Made

Mode is the Valve that occurs

most frequently in a data set

When distribution has ONE value that appears

most frequently it is Said to be

Oni mode
 When TWO
a set of data has

or THREE Valves that occur most

it is said to be
frequently

Bimode or Tfi mode

lathat is the
I mode of the following
data set

301 287 254 234 287

157 5
 Compounding
r effect
Geometric Ilan
The used
geometric mean is often
when Calculating investment returns

over multiple or when

periods
Compound
measuring growth rates
 020 t IIe
E
Enameler For the last three
years
returns for Inffy Common stock

have been 207

IT 107 f 57
m

Itr 1 92 HII
IOS
120 110 1
XIE
1 386 1 x 100

I
20 10
51T
0.95

51
f 0.05 I

015
120 i 10 o 95 x too

7131
I Information about Stock

Prices is given for last

4 Years
Pr
100
Pe
120 2
j132
138.6
tip I

E CETI
ET EIKE
1
1.386
I
 Practise
Calculate mean
geometric
for following Daka

Returns

9.39 23.457 48.297

6.821
 Harmonic Mean
u in

C to find out average Cost

Harmonic mean is used

Of Shares Purchased over time

gAf

Month Investment MA No of units

Amount

san
Lo
Feb 000 127W
March
100005 200
I 525
am
I
 É

07250.20
0.10

ÉÉ

I
Peafise

K An investor Purchases 1000 Of mutual

fund Shares each month f over the

the
last three months Price
per share
were 8 9 4 10

Per share
What is the average Cost

EFFIE
7 2 K 22

Prayise
612 21
9.1
2015 2016 2017 2018 2019 2020

224 5 7 11 2

What is the median return

A 7.31 B 80 lot
9

The harmonic
91 mean
of 3,485 is
A 3.74 B 3 83 C 4.12

5 3 E
 2015 2016 2017 2018 2019 2020

221 57 7T 11 27 11

The mean Xyz stock is

annual return on

most appropriately calculated using

The harmonic mean

The arithmetic mean

The geometric mean

HMI4
d mg

r
 r

Okanties

Quantile or fractile is a valve at or

below which a stated fraction of

data lies

Moo gentiles ate as follow

Quartiles Divide the data into 4

equal Parks

Guinkiles 5
Divide the data into
equal Parks
Decile Divide the data into 10

equal parks

Percentile Divide the data into 100

equal parts
 Example

What is the third quartile for the

following distribution
of tetons
Eon
E81 101 127 137 157 177 177 187 197

231

fnti r
Sol Ly go
1 Location n no of data Points
ye position to be found out
un

Got 1 It
8.147
18 835 182
 Measure If Dispersion

In Stat dispersion measure the Variation

in the data set around the mean

INFOSYS RETURNS

II
I 3
57 64 17

TCS
m
RETURNS

I 2 3

eat
 Note

When Observations are Very Close to the

mean this means less
_Dispersion
less Dispersion means low Risk

When Observations are far awayfrom the

mean this means HIGH
_Dispersion
HIGH Dispersion means HIGH
_Risk
 TYPES OF DISPERSION

ti t7
Range MAD Variance Standard Coefficient
Deviation Of
Variation
 Range Highest Lowest
Value Value

Range
INFy
If f 5

22

Rangetes 10 8

Higher Range means HIGHER Dispersion

Lowe Range means less Dispersion

 Mean Absolute Petition MAD

I Calculate the MAD from the following

data

R 301 121 251 201 231

so
step't Find the MEAN

step 2 Find the DEVIATION

steps Find the Aya of Deviation

 A Deviation

É SE Ist
25 3
MAD 1 12,11
20 2
2,4 421

23 1

I
It
En st

tote The Sum of deviation from mean

it always leg
 Keane Standard Deviation

I Calculate Variance Standard

deviation data set
of following

301 121 251 201 23

SOI
step 1 Find Mean

Steps Find Deviation

Step Square Deviation

w

Step It Find the Avg

w of SquareuDeviation
A
Variance O2

steps Find the Square Root to

get Standard Deviation o
 R R R R IT
30 8 64

12 Variance É
FT
25
t
3 9f
g
20
I
I stands'efiation
22

EFFI 171
5

8 35 variance

Standard
Deviation
HI
O
EEE
o
KID
Sy 6.67 Sample Standard Deviation

f Pop standard Deviation

221 I 5 96

27
116.09 961
 How to Solve in fall

Variance Standard Deviation

in un un

2nd DATA 2nd Clswork

101 30 Enter 1 I

402 12 Inter I 1

403 25 Enter 1 I
09 20 Enter f f
0523 Enter
2nd STAT I
2 5 I
7 22 I
26.67127
5
Ox 5 996
Population
f
Ni Ftt
N IF I

same
7

JEE JEE
J
r
Sample
m
Variance
n
Sample Standard

Texiation
n

02 V9 4

O 22

Sand Liana
 Semivariancefsemideition

30 12

R
we
257 20 237

Step i Find Mean

30 20123
F
22
325 I
T
sty Ii find the squared deviation
only for observation below mean

RI CR TT II

10 100

2 28
IT
 Stys Divide the sum of the

squared negative deviations by n s

step 4 Find the

square root to get
semi deviation

Ta
semi
si
deviation
 Mean Target valve

Target Semivariana f
Eideviation

In this case we choose a target Value

against which to measure each outcome

f only include deviations from the

target value in our calculation

If the outcomes are below that

target
 Example

Calculate the target downside deviation

based on the following data with

target return of 24 E E
mm

Ent
50 12 2590 20 231

In

TE
R E CR ET

16
y
I
goy
6.3
 Paradise

Given the following observations

2 4 5 6 7 9 10 11

The 65th Percentile is closest to

5.85 6.55 8.70

2011 2012 2013 2014 2015 2016

221 5 71 11 21 Ht

What is the Sample standard deviation

987 72.47 96 34
 2011 2012 2013 2014 2015 2016
5 7T 11 21
IN
221 N

Assume an investor has a target return

of 11 for Xyz stock What is the

stock's target downside deviation

9.41 121 14.87

R E R E
5 11 6 36

F 11 18 324
2 11 9 81
 Coefficient of Variation
Rist
Coefficient of Variation is the ratio of
in

me
standard deviation to the mean

as
value

5
CX

S S D

I Mean
 Asset Class Mean
go
Standard
Deviation

I
Equity 204 401

Bonds 104 10

EE É
Bonds I

To earn
Hetton we are

taking 21ft
T
 Normal Distribution
in mm

Draw a histogram of the

following data

Heights in cm Number of students

150 153
153 156
156 159
159 162
14
10
of
7
8

162 165 6
165 168 5
Mt
B

I.is ith

XIs
 The Shapenot the Distribution

Nema Distribution

9 Completely described
by
the Mean
f 02

i mean median mode

iii Skewness
I
Symmetrical

ÉÉ
Distribution
A
is as

m
 Right
Positively skewed distribution

tail
ref i k

right tail
MI tn
mode
x

characteristics
I leftside
1

2
a

Unlimited but
Q
Limited but frequent downside returns

frequent upside
E
less
F returns

MLanymediatnod
3

4 Skewness 7 O
position
 Downside returns are frequent

Frequent because of the large area in

the distribution

Limited downside returns is because

we are going down to a certain

point

In Short we will have losses but

those losses will be limited therefore
we are limited downside Tetons
saying
but happens quite frequently because
of the large
area
On the upside we are unlimited

because these upside returns can

be quite high but at the same time

less frequent as the area is much

lower

With Positive Skew we have

frequent but limited losses

very high infrequent returns

 Mean
I
Median Mode

mode
I
f mean
median

year Median Mode

 Left
degatively Skewed Distribution

A
m
Thea
mode
median

Limited
E
but frequent upside returns

Unlimited but less frequent downside

Tuan Octoons

Mean median a mode

Skewness Lo negative
Out of the three distribution

which distribution investor will

Prefer why
 Practise Questions

O Which
of the following distribution
is most likely characterized by

frequent Smail losses few extreme

I
gains

Normal Negatively Positively

Distribution Skewed Skewed
Distribution Distribution
I Which
of the following is most

likely true for a

Negatively

Skewed Distribution

Mean a Median h mode

Mode L Median L mean

Median mean mode

 KI
Kurtosis
men

height
kurtosis measure
y
how peaked is the

distrbiution

leptokooki

all E a positive

É
K 3
amap
K 3 piatyzustin tic

xplat.gl
 D
Mesokurkic is a normal distribution

with kurtosis 3

Leptokuatic distribution have k 3

Investor do not like the leptokurtic

distribution

Platykuntic distribution K 3
 I
Excess kurtosis
distribution
normal
kurtosis 3
1

O 3
mecurki
5 3
Leptonic
I 2 platy Kurti

Ee
Positive I lepto

ZERO mesokrotic

Negative platy
 Frequency Distribution table
Annual Returns for Tcs Ltd

10.47 22 51 11.1.1 1247

9 81 17 1 2.87 8 4
34 67 28.61 0.61 5 07
17 61 5 61 8 91 40.47
I 0 4.21 5 21 21 07

Step 1 Defining the Interval

step 2
Tally the observations

Step 3 Count the Observations

 Interval Tallies Absolute

Yard Frequency
30 5 Rt 2 201
I
20 Rt 10 11 2
IOT E Rt cot 111 3
mode
OF

10
E Rt

Rt
L 10

rot
I 1111111

111
7

3
E

207 E REL 301 11

O 2

30 I Rt hot I I

407 I Rt a sot I I

samples in
 Width of interval
w
w w

YEE
Toda Interval

Absolute frequency third Interval

of
 É
Interval Absolute Relative
Frequency Frequency

3011 Rt 4 201 I

2 2 20 109
207 Rt to

IOT E Rt cot 3 3120 151

OF E Rt L 107 7 35

10 E RE 207
E 3 157

20 E REL 30 2 10

30 I Rt hot I 54

407 I Rt a sot I 51

fakiate Relative treg any of

sthIntfan
Nominal Data Radffangemok
IT II 12 I

I B 201 II
I C ist I

Ordinal data Data can be ranked

in order
a
logical