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Unit 8: Skewness and Kurtosis: Karl Pearson, Bowley, Kelly's Methods

size of a series of bets. In most gambling scenarios, and some Notes
investing scenarios under some simplifying assumptions, the Kelly
strategy will do better than any essentially different strategy in the
long run. It was described by J. L. Kelly, Jr in 1956.[1] The practical
use of the formula has been demonstrated.
8.6 Review Questions

1. What do you understand by skewness ? Give various definitions. What are the various methods
of measuring it.
2. Give the concept of kurtosis.
3. Distinguish between Pearson’s and Bowley’s measure of skewness.
4. State the formula for calculating Karl Pearson’s coefficient of skewness.

Answers: Self-Assessment
1. (i)0 (ii) 0.1 (iii) 108.2 (iv) zero (v)± 1
8.7 Further Readings

1. Elementary Statistical Methods; SP. Gupta, Sultan Chand & Sons,
New Delhi - 110002.
2. Statistical Methods — An Introductory Text; Jyoti Prasad Medhi, New Age
International Publishers, New Delhi - 110002.
3. Statistics; E. Narayanan Nadar, PHI Learning Private Limied, New Delhi - 110012.
4. Quantitative Methods—Theory and Applications; J.K. Sharma, Macmillan
Publishers India Ltd., New Delhi - 110002.

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