Frequency distribution and One-leg-out payment: Difference between pages

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''Statistics''
''Payment Services Directive 2 (PSD2)''.


A description of the relative number of times that given outcomes have occurred, or are expected to occur, relative to the whole population.  
A one-leg-out payment is one where only one of two payment service providers involved is located in the European Union (EU).


Three important frequency distributions are the Normal distribution, Lognormal distribution, and Leptokurtic distribution, described below.  
Also known as 'one leg' payments.


All three of these types of distribution are used in practice as approximations to model the distributions of financial variables.


<span style="color:#4B0082">'''''Transparency and cost'''''</span>


1. ''Normal distributions'' are usually the simplest approximations to work with, and are assumed by - for example - many Value at Risk analysis models and measures. A theoretical shortcoming of using normal distributions as a model is that they assume an infinitely large downside potential including negative prices; whereas many financial variables - such as asset prices - cannot in practice fall so far as to become negative.
:"PSD2 is set to bring improved transparency, as payments going out of the EU will be required to have transparency on cost, opening the way to better management of one-leg-out payments."


:''The Treasurer magazine, August 2018, p15.''


2. ''Lognormal distributions'' usually describe better the theoretical range of financial variables such as traded equity prices, which theoretically have no upside limit but which cannot fall below zero.




3. In practice, observed financial returns are usually more closely approximated by ''leptokurtic distributions'', with a greater frequency both of very high and of very low returns, than predicted by the comparable normal or lognormal distribution. So in risk analysis, if a population distribution is assumed to be normal or lognormal, but is in reality leptokurtic, downside risk will be understated.
== See also ==
* [[European Union]]
* [[Payment service provider]]
* [[Payment Services Directive]]
* [[Payments and payment systems]]
* [[PSD2]]
* [[Single Euro Payments Area]]




Other commonly used types of theoretical frequency distribution include Binomial distributions and Poisson distributions.


 
===Other links===
== See also ==
[http://www.treasurers.org/node/10186?utm_source=Communicator&utm_medium=Email&utm_content=Untitled13&utm_campaign=Monthly+Newsletter+-+June+2014: EACT position paper on PSD2]
* [[Binomial distribution]]
* [[Cumulative frequency distributions]]
* [[Decile]]
* [[Frequency curve]]
* [[Frequency polygon]]
* [[Grouped frequency distribution]]
* [[Histogram]]
* [[Leptokurtic frequency distribution]]
* [[Lognormal frequency distribution]]
* [[Normal frequency distribution]]
* [[Percentile]]
* [[Poisson distribution]]
* [[Probability]]
* [[Value at risk]]

Revision as of 15:34, 3 August 2018

Payment Services Directive 2 (PSD2).

A one-leg-out payment is one where only one of two payment service providers involved is located in the European Union (EU).

Also known as 'one leg' payments.


Transparency and cost

"PSD2 is set to bring improved transparency, as payments going out of the EU will be required to have transparency on cost, opening the way to better management of one-leg-out payments."
The Treasurer magazine, August 2018, p15.


See also


Other links

EACT position paper on PSD2