A Bell curve is most common type of distribution for a variable and considered as Normal Distribution.

KEY TAKEAWAYS

  • A bell curve is a graph that is considered to be a normal distribution.
  • The top of the curve shows the most likely event out of the data collected.
  • After the mean is calculated, standard deviations are figured.
  • Standard deviations that depict the returns of a security are known as volatility.
  • When making assumptions about a stock’s potential future returns, investors look at the normal probability distribution of its past returns

What Does a Bell Curve Tell You?