Difference Between Kurtosis & Dispersion

CFA Level I
#1

Hi Guys,

What’s the difference between Kurtosis and Dispersion? If a distribution is dispersed, it means it has extreme outcomes as likely, if it’s not dispersed, then extreme outcomes become unlikely. But that’s the definition of kurtosis according to the book.

#2

Dispersion is typically measured with variance or standard deviation.

Kurtosis measures (broadly) how peaked the distribution is:

  • Positive excess kurtosis means that the distribution has a higher peak than a normal distribution with the same variance
  • Negative excess kurtosis means that the distribution has a lower peak than a normal distribution with the same variance.

I wrote an article on kurtosis that may be of some help here: http://financialexamhelp123.com/kurtosis/

#3

Here’s another explanation:

https://www.physicsforums.com/threads/difference-between-standard-deviation-and-kurtosis.322487/