- CFA Exams
- CFA Level I Exam
- Study Session 2. Quantitative Methods (1)
- Reading 7. Statistical Concepts and Market Returns
- Subject 10. Kurtosis in Return Distributions

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**CFA Practice Question**

We can determine something about the skewness of a distribution by considering which of the following?

A. the sum of the squares of differences from the mean

B. the cubes of differences from the mean

C. the fourth power of differences from the mean

**Explanation:**This is the formula for the sample relative skewness.

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**User Contributed Comments**
5

User |
Comment |
---|---|

mc25456 |
skewness---cubes |

pierreE14 |
skewness => cube because we need to keep the (+) or (-) sign of the deviation If you square or use the 4th power, you would only get a (+) answer |

Lamkerst |
the forth power --> kurtosis |

Saxonomy |
^1 = mean ^2 = variance ^(2/2) = standard deviation ^3 = skewness ^4 = kurtosis Ok, I'm bored. |

Saxonomy |
^5 = (somebody will publish this by 2016 CFA book) |