In this session, I look at applications of sampling in investing and finance, beginning with stock market indices (almost always samples, and almost never random) before looking at time sampling, where I look at the price earnings ratio for US stocks from 1960 to 2020 and the behavior of small cap stocks, relative to large cap stocks, from 1927 to 2020. In both cases, I note the bias that can be introduced by changing time periods for the analysis. In the final section, I look at how sampling is used to test investing strategies (value versus growth) and how stock prices react to specific events (acquisitions).
Slides: http://www.stern.nyu.edu/~adamodar/pdfiles/Statistics101/Slides/Session2A.pdf
Post class test: http://www.stern.nyu.edu/~adamodar/pdfiles/Statistics101/postclass/session2Atest.pdf
Post class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/Statistics101/postclass/session2Asoln.pdf
Webpage for statistics class: http://people.stern.nyu.edu/adamodar/New_Home_Page/webcaststatistics.htm
YouTube Playlist for this class: https://www.youtube.com/playlist?list=PLUkh9m2BorqmXcRzWFbzcjMd7fYErVexF