Normal frequency distribution and Outright Monetary Transactions: Difference between pages

From ACT Wiki
(Difference between pages)
Jump to navigationJump to search
imported>Doug Williamson
(Removed link)
 
imported>Doug Williamson
m (Standardise header, minor rewording for clarity and categorise page.)
 
Line 1: Line 1:
A normal frequency distribution is a theoretical continuous, symmetrical, bell-shaped distribution function. 
(OMT).
Its mean, mode and median are all the same; and both the tails of the bell curve are infinitely long.


Because of its symmetry, a normal frequency distribution can be described fully by its mean and its standard deviation.
Part of the [[open market operations]] of a central bank in which the central bank buys or sells securities outright - i.e. without the re-sale or re-purchase legs of [[reverse repurchase agreement]]s or [[repurchase agreement]]s.


Commonly abbreviated to ''normal distribution''.
This was a new tool for the European Central Bank in 2012 - and controversial, especially in Germany - though its use by other banks has not been so dogged by controversy.


 
[[Category:Risk_frameworks]]
Simple normal distributions are frequently used for modelling uncertainty.  However, reality is rarely so neat and symmetrical as the normal distribution model.
 
This can lead to spurious accuracy and a false sense of security from relying on models of that kind.
 
 
== See also ==
* [[Binomial]]
* [[Fat tail]]
* [[Frequency distribution]]
* [[Kurtosis]]
* [[Leptokurtic frequency distribution]]
* [[Lognormal frequency distribution]]
* [[Mean]]
* [[Mode]]
* [[Median]]
* [[Standard deviation]]
* [[Standardised normal distribution]]
* [[Tail event]]
* [[Tail risk]]
* [[Value at risk]]
 
 
===Other links===
[http://www.treasurers.org/node/9214 Students: Perfect proportions, The Treasurer, July 2013]
 
[[Category:Financial_risk_management]]

Revision as of 19:06, 28 August 2014

(OMT).

Part of the open market operations of a central bank in which the central bank buys or sells securities outright - i.e. without the re-sale or re-purchase legs of reverse repurchase agreements or repurchase agreements.

This was a new tool for the European Central Bank in 2012 - and controversial, especially in Germany - though its use by other banks has not been so dogged by controversy.

Retrieved from ‘https://wiki.treasurers.org/w/index.php?title=Normal_frequency_distribution&oldid=35774’