Question: a. What does it mean that a return distribution has a fat tail? b. What is the implication if a return distribution is assumed to

a. What does it mean that a return distribution has a fat tail?

b. What is the implication if a return distribution is assumed to be normally distributed but is in fact a fat-tailed distribution?

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a Fat Tail In finance and statistics a fat tail refers to the shape of the distribution of returns or outcomes in a dataset Specifically it describes ... View full answer

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a. What does it mean that a return distribution has a fat tail? b. What is the implication if a return distribution is assumed to be normally distributed but is in fact a fat-tailed distribution?

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