Discover normal distribution—a critical concept in finance—and its key properties, formula, and real-world applications.

Standard deviation is a metric that shows the variability of a security’s returns over time. It can be used to gauge volatility based on past performance and compare a future return to past returns.

The normal distribution is the probability distribution that plots all of its values along a symmetrical bell curve, with the highest probabilities centered around the mean value and tapering out ...