easy · Quantitative Finance prob-stats
A proprietary trading signal has a 20% prior probability of correctly identifying an outperformer. If the signal fires, the likelihood it is correct is 80%, but it also fires falsely for 30% of non-outperformers.
What is the probability the stock outperforms given the signal fired?
- 80%.
- 16%.
- 40%.
- 50%.
Sign up free to see the explanation and track your rank →
More Quantitative Finance prob-stats practice
- What is the estimated OLS slope hatβ?
- Assuming 252 trading days in a year, what is the annualized historical volatility?
- If the correlation between two assets is ρ = 0.6, what is the R^2 of a linear regression o
- If the slope β is positive, what is the correlation coefficient ρ between x and y?
- What is the defining property of the 'Cumulative Distribution Function' F(x)?
- Which 'standardized moment' should they measure to quantify this?
- Which statistical property describes a time series where the mean, variance, and autocorre
- What is the estimated OLS beta (slope) of the stock?