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### 28 Cards in this Set

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 In a positively skewed distribution, what is the order (from lowest value to highest) for the distribution’s mode, mean, and median values? Mode, median, mean. Mode most frequently occuring number median middle number mean average Sharpe Ratio (Return Portfolio-Risk Free Return)/Standard Deviation Bank Discount Yield (Discount/face)x( 360/days to maturity) Holding Period Yeild (End value/ Beginnning Value)-1 Effective annual Yield (1+HPY)^365/days-1 Money Market Yield HPYx(360/days to maturity) geometric mean (1.01*1.05*.95)^(1/3) Harmonic Mean Average Cost per share over time in constant dollar amounts. 2/ (1/20+1/25)=22.22 varience average of squared deviations from the mean standard deviation Square root of varience chebyyshev's inequality what % of oberservations must lie withing k standard deviations of the mean? min%= 1-(1/k^2) coefficient of variation measure of risk per unit of return. lower the better CV=standard deviation/mean Sharpe Ratio Excess return per unit of risk...more the better. Sharpe: (Rp-Rf/Std. dev) leptokurtik more peaked with more extreme outliers (kurtosis>3) covarience measure of how two variables move togehter Correlation measur of the linear relationship between two variables Correlation= CovA, B/( Std Dev A, Std Dev B) central limit theorem According to the central limit theorem, the mean of the distribution of sample means will be equal to the population mean. n > 30 is only required for distributions of sample means to approach normal distribution. parameter parameter is any descriptive measure of a population characteristic. Bank Discount Yield Formula he bank discount yield is computed by the following formula, r = (dollar discount / face value) × (360 / number of days until maturity) formula for a binomial random variable Use the formula for a binomial random variable to calculate the answer to this question. We will define "success" as the team winning a game. The formula is: p(x) = P(X = x) = [number of ways to choose x from n] × px × (1 - p)n-x, where [number of ways to choose x from n] = n! / [(n - x)! × x!]. number of ways to choose x from n] number of ways to choose x from n] = n! / [(n - x)! × x!]. Stratified random sampling. In stratified random sampling, we first divide the population into subgroups based on some relevant characteristic(s) and then make random draws from each group. Effective Annual Yeild Formula (1 + HPY)365/t) − 1 probability distribution The probability distribution may or may not reflect reality. But the probability distribution must list all possible outcomes, and probabilities can only have non-negative values. Bond Equivilant Yield ((1000-purchase price)/purchase price)*(365/days to maturity)