# finc 121

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Category: Education

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### VARIANCE AND STANDARD DEVIATION:

VARIANCE AND STANDARD DEVIATION

### Variance:

Variance Variance is used as a measure of how far a set of numbers are spread out from each other. It is one of several descriptors of a probability distribution, describing how far the numbers lie from the mean (expected value). In particular, the variance is one of the moments of a distribution. In that context, it forms part of a systematic approach to distinguishing between probability distributions. While other such approaches have been developed, those based on moments are advantageous in terms of mathematical and computational simplicity.

### Standard Deviation:

Standard Deviation Standard deviation is a widely used measurement of variability or diversity used in statistics and probability theory. It shows how much variation or "dispersion" there is from the average (mean, or expected value). A low standard deviation indicates that the data points tend to be very close to the mean, whereas high standard deviation indicates that the data are spread out over a large range of values.