Fat Tails

Discussion in 'Index Futures' started by Bong Recreation, Oct 23, 2002.

  1. I've heard it said before that the futures markets tend to have "fat tails." What exactly does this mean and how is it calculated?

  2. cheeks


    "fat tails" - Refers to a bell curve that has more outlying events than a normal distribution.

    Ex. Lets look at the probability distribution of the chances of my getting laid this weekend by an extremely hot or extremely ugly girl. Will say a girl that is a "5" is the mean.

    first scenario: I am sober. I don't have the balls to talk to hot girls and I definetly not talking to ugly ones. Vey few low or high numbers(ie 2,3 or 8,9) going home with me this night.
    =Standard distribution

    second scenario: I am drunk as hell and saying just about anything to every girl in the bar. God only knows what I would go home with this night.:D

    This distrubtion would have a lot of outlying events from the mean(1's and 10's)

    "fat tails"(pardon the pun)

    I think my friends would argue that the second scenario would actually result in more data points on one side of the mean.
    :( :( :(
  3. now there's a useful analogy...

    pretty sure most guys could relate to that...
  4. Thanks for the info and interesting analogy. :D :D
  5. The mind Boggles!!!!!!!!!!!!!!!!!!!!!

    Oh well - I suppose boys will be boys...


  6. KB96


    I went home at 2 with a 10 and woke up at 10 with a 2.....what happened???:confused: :confused: :confused:
  7. Story of my life ...
  8. dottom


    I dated a 10, married a 6, slept with a 4, and now wake up to a 2. Problem is, she's the same person!

    j/k :)
  9. I asked my plastic surgeon friend to cut my 2 in half and add a zero.

    you guys are cracking me up !!! :D :D
  10. Has anyone else noticed that when you look at the gals sitting around a bar at about 1 in the morning, all the ugly ones have gotten up and gone home.
    #10     Oct 24, 2002