SKEWNESS

Definition: skewness is a measure of the asymmetry of the probability distribution of a realvalued random variable. The skewness value can be positive or negative, or even undefined.
Skewness is a measure of symmetry, or more precisely, the lack of symmetry. A distribution, or data set, is symmetric if it looks the same to the left and right of the center point.

Types of Skewness Positive vs. Negative Skewness A positive skew indicates that the tail on the right side is longer than the left side and the bulk of the values lie to the left of the mean. A zero value indicates that the values are relatively evenly distributed on both sides of the mean, typically but not necessarily implying a symmetric distribution. Ex. positive skew: The right tail is longer; the mass of the distribution is concentrated on the left of the figure. It has relatively few high values. The distribution is said to be right-skewed or "skewed to the right".[1] Example (observations): 1,2,3,4,100. a negative skew indicates that the tail on the left side of the probability density function is longer than the right side and the bulk of the values (possibly including the median) lie to the right of the mean. Ex. negative skew: The left tail is longer; the mass of the distribution is concentrated on the right of the figure. It has relatively few low values. The distribution is said to be left-skewed or "skewed to the left".[1] Example (observations): 1,1000,1001,1002,1003 the skew normal distribution is a continuous probability distribution that generalises the normal distribution to allow for non-zero skewness.

Normal Distribution
Characteristics of Normal distribution frequency analysis of data reveals bell curve most values near the middle datum or average of the sample very few values near the upper and lower extremes data fit the formula of a normal distribution

Deviations from Normal Distribution

Measure using the pth moment of the mean Symmetry and skewness - deviation from normal distribution using the third moment of the mean skewed to the left (negative skew) skewed to the right (positive skew) measure of skewness

Kurtosis - evaluates distance of values near and away from the mean from using the fourth moment of the mean platykurtic - flat distribution where most of the values are near the mean leptokurtic - peaked distribution with most of the values are towards the tails measure of kurtosis

Skewness formula

Problem Find the skewness of the eruption duration in the data set faithful. Solution We apply the skewness function in the moments package to compute the skewness coefficient of eruptions. As the package is not in the core R library, it has to be installed and loaded into the R workspace. > library(moments) # load the moments package > duration = faithful$eruptions # the eruption durations > skewness(duration) # apply the skewness function [1] -0.41584 Answer The skewness of the eruption duration is -0.41584. It indicates that the eruption duration distribution is skewed towards the left. Exercise Find the skewness of the eruption waiting periods in faithful. Note The skewness function in the moments package is based on the formula g1 = m3m232, where m2 and m3 are the second and third sample central moments. Besides being prone to rounding errors, the function provides only a biased estimate of the corresponding population statistics 1. What Does Coefficient Of Variation - CV Mean? A statistical measure of the dispersion of data points in a data series around the mean. It is calculated as follows:

The coefficient of variation represents the ratio of the standard deviation to the mean, and it is a useful statistic for comparing the degree of variation from one data series to another, even if the means are drastically different from each other.

Coefficient of variation
Another way to describe the variation of a test is calculate the coefficient of variation, or CV. The CV expresses the variation as a percentage of the mean, and is calculated as follows: CV% = (SD/Xbar)100 In the laboratory, the CV is preferred when the SD increases in proportion to concentration. For example, the data from a replication experiment may show an SD of 4 units at a concentration of 100 units and an SD of 8 units at a concentration of 200 units. The CVs are 4.0% at both levels and the CV is more useful than the SD for describing method performance at concentrations in between. However, not all tests will demonstrate imprecision that is constant in terms of CV. For some tests, the SD may be constant over the analytical range. The CV also provides a general "feeling" about the performance of a method. CVs of 5% or less generally give us a feeling of good method performance, whereas CVs of 10% and higher sound bad. However, you should look carefully at the mean value before judging a CV. At very low concentrations, the CV may be high and at high concentrations the CV may be low. For example, a bilirubin test with an SD of 0.1 mg/dL at a mean value of 0.5 mg/dL has a CV of 20%, whereas an SD of 1.0 mg/dL at a concentration of 20 mg/dL corresponds to a CV of 5.0%.

example
Barron's Accounting Dictionary:

Coefficient of variation
Top Home > Library > Business & Finance > Accounting Dictionary Measure of relative dispersion, or relative risk. It is computed by dividing the standard deviation (s) by the expected value (x - ). For example, consider two investment proposals, A and B, with the following data:

The coefficient of variation for each proposal is: For A: $107.70/$230 = .47 For B: $208.57/$250 = .83.

Therefore, because the coefficient is a relative measure of risk, B is considered more risky than A. Previous: Coefficient of Determination, Coding of Accounts, Code of Professional Ethics Next: Coinsurance Clause, Collateralize, Collectibles Read more: http://www.answers.com/topic/coefficient-of-variation#ixzz1RyNutjXG