Page 46 - FINAL CFA I SLIDES JUNE 2019 DAY 3
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LOS 10.i: Explain the key properties of the normal Session Unit 3:
distribution, p223
10. Common Probability Distributions
• The p of outcomes further above and below the μ get smaller and
smaller but do not go to zero (the tails get very thin but extend
infinitely).
• Meaning what?
Key Properties:
• described by mean, μ, & variance, σ2, stated as X ~
N(μ, σ2).
• Skewness = 0, i.e. symmetric about its
mean, so that P(X ≤ μ) = P(μ ≤ X) = 0.5,
• mean = median = mode.
• Kurtosis = 3; this is a measure of how flat the distribution is.
