- 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**

In computing skewness, which of the following is true?

II. It raises the deviation from the mean to the third power.

III. The formula preserves the direction of the deviation.

I. It uses the cubed deviation from the mean.

II. It raises the deviation from the mean to the third power.

III. The formula preserves the direction of the deviation.

Correct Answer: I, II and III

I and II are true and equivalent. III is true because the cube of a negative number is still a negative number: -2 * -2 * -2 = -8.

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