From the course: Everyday Statistics, with Eddie Davila

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Stock market ups and downs

Stock market ups and downs

- [Narrator] "Today, a record high gain on Wall Street." "The biggest one day drop in history." We seem to hear this a lot. In 2018 alone, we saw at least seven of the top single-day point gains in history and in that same year, 2018, we saw at least nine of the top 20 single-day point losses in history. And while it makes for dramatic headlines and creates elation or fear among some investors, the single-day gains and losses are rarely as history-worthy as the media would lead you to believe, and if you understand basic statistics these dramatic announcements probably also drive you crazy. Points gains are not nearly as meaningful as percentage gains. In fact, not one of those 2018 point gains or losses are among the top percentage gains and losses in history. As an example, consider a 500 point gain for a stock index that opened the day at 20,000. This is only a 2.5% gain for that market. A nice gain, but not…

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