- CFA Exams
- CFA Level I Exam
- Topic 1. Quantitative Methods
- Learning Module 3. Statistical Measures of Asset Returns
- Subject 3. Measures of Shape of a Distribution
CFA Practice Question
Which is true of a leptokurtic distribution?
II. It will have thinner tails than a normal distribution.
III. It will be less peaked than a normal distribution.
IV. It will have fatter tails than a normal distribution.
I. It will be more peaked than a normal distribution.
II. It will have thinner tails than a normal distribution.
III. It will be less peaked than a normal distribution.
IV. It will have fatter tails than a normal distribution.
A. I and II
B. I and IV
C. III and IV
Explanation: I and IV are true of leptokurtic distributions. This is also called having "excess kurtosis." II and III are characteristic of platykurtic distributions.
User Contributed Comments 5
User | Comment |
---|---|
sabcfa1 | more peaked and fatter tails ... leptokurtic dist has greater percentage of extreme outcomes than normal dist (see Vol 1, page 300 & figure 7-8) |
poomie83 | this is how I remember it lepto is fatter lepto sound like lypo which is what the fatties get done |
maria15 | Poomie83 - lol. But helpful :) |
toscarlett | poomie83 - really thanks!^) |
CJPerugini | I don't like the term "thin" and "fat" for the tails. It implies thickness not width. |