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Home > QFINANCE Dictionary > Definition of probability sampling

Definition of

# probability sampling

Statistics

creating statistical sample that could include any individual in a statistical study, a way of sampling in which every individual in a finite population has a known, but not necessarily equal, chance of being included in the sample

probability sampling - Related Articles
• ### Binomial Distribution

Calculations

This is considered to be the most accurate calculation of binomial probabilities, since it involves precise calculation. However, it is best used where n is less than 1,000, or where you are using a computer program to perform more complex calculations on larger sample sizes.

• ### Modeling Market Risk

Best Practice

The idea of Monte Carlo VaR simulation is to fit the log-returns to some parametric distribution and to replace the historical log-returns in the above equation by samples for the probability distribution. The choice of the probability distribution has a big impact on the properties and performance of the VaR model
By Marius Bochniak

• ### Analysis Using Monte Carlo Simulation

Checklists

Monte Carlo simulation randomly samples inputs to produce many thousands of possible outcomes, rather than a few discrete scenarios as produced, for example, by deterministic modeling using single-point estimates. Monte Carlo results also give probabilities for different outcomes. Lay decision

• ### Covariance

Calculations

Covariance measures the relationship between two random variables. For example, we might measure whether a sample population liked drinking wine, and whether they liked eating cheese. Covariance is a form of probability theory that allows us to measure the extent to which those two random variables

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Definitions of ’probability sampling’ and meaning of ’probability sampling’ are from the book publication, QFINANCE – The Ultimate Resource, © 2009 Bloomsbury Information Ltd. Find definitions for ’probability sampling’ and other financial terms with our online QFINANCE Financial Dictionary.