Kurtosis Indicator
Select Equity |
Kurtosis In A Nutshell
Data is usually distributed normally which means if you take a visual depiction of the data it would look like a bell shaped curve. If looking at statistics, a normal distribution is desired because this will give you best opportunity to find where standard deviations are along with other measures depending on the data.
When looking at data, it is important to understand how it is laid out and if everything seems appropriate. Skewness and distribution of data around the mean is key and Kurtosis helps with measuring that.
Closer Look at Kurtosis
There are a few different kinds of Kurtosis, so let us start with Leptokurtic. Visually, this is when the bell shape is skinny and tall compared to a normal bell curve distribution. What this can indicate is that the data is really close together and data falls off drastically sooner in relation to the mean.
Secondly there is Mesokurtic, and this appears with a fatter and shorter bell curve, indicate the data may be spread out further. Standard deviations and other statistical data will be different but that does not mean it will be incorrect.
Lastly, there is Platykurtic, which means the bell in the middle is really evened out and that could indicate data is further dispersed than all the other variations. However, just like the others, this does not mean it is positively or negatively affecting the research.
With Kurtosis, it allows people to view data and the skewness and begin taking it apart. Be sure to fully understand the statistical data and what you are searching for because it will vary between each investor and trader. Take a look through Macroaxis as well as other Internet articles as this may not be for all investors. Test it out on a demo account and see if it fits your current investing style. Kurtosis has been around for quite some time and will continue to be a tool in the toolbox of finance.
Other Indicators
All Technical Analysis
Other Consideration for investing
Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Fundamental Analysis View fundamental data based on most recent published financial statements |