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I have a somewhat related question - and openly admit to being a neophyte

my question is this traditional variance weights positive and negative outcomes equally

how can one compute a variance that reflects a persons bias (risk aversion) toward a directional outcome as in business assume an ill favored outcome is worth 0.5x and a preferred outcome is worth 1.5x

would a person compute 2 variances by creating 2 sub populations illfavored/preferred and apply the formula var (bx) = b^2times sigma^2 to each population and sum the final products?

am I wrong in this line of thinking? is there another approach? its been quite some time since my university stats days - so please be gentle with my ignorance

appreciate your thoughts and if you ping my email to let me know miroslodki (at) yahoo (dot) ca

btw - fascinating site and discussion regarding crowd wisdom - fwiw I share your viewpoints/concerns you've found a new reader cheers Miro