Skip to content

Explore Courses | Elder Research | Contact | LMS Login

Statistics.com Logo
  • Courses
    • See All Courses
    • Calendar
    • Intro stats for college credit
    • Faculty
    • Group training
    • Credit & Credentialing
    • Teach With Us
  • Programs/Degrees
    • Certificates
      • Analytics for Data Science
      • Biostatistics
      • Programming For Data Science – Python (Experienced)
      • Programming For Data Science – Python (Novice)
      • Programming For Data Science – R (Experienced)
      • Programming For Data Science – R (Novice)
      • Social Science
    • Undergraduate Degree Programs
    • Graduate Degree Programs
    • Massive Open Online Courses (MOOC)
  • Partnerships
    • Higher Education
    • Enterprise
  • Resources
    • About Us
    • Blog
    • Word Of The Week
    • News and Announcements
    • Newsletter signup
    • Glossary
    • Statistical Symbols
    • FAQs & Knowledge Base
    • Testimonials
    • Test Yourself
Menu
  • Courses
    • See All Courses
    • Calendar
    • Intro stats for college credit
    • Faculty
    • Group training
    • Credit & Credentialing
    • Teach With Us
  • Programs/Degrees
    • Certificates
      • Analytics for Data Science
      • Biostatistics
      • Programming For Data Science – Python (Experienced)
      • Programming For Data Science – Python (Novice)
      • Programming For Data Science – R (Experienced)
      • Programming For Data Science – R (Novice)
      • Social Science
    • Undergraduate Degree Programs
    • Graduate Degree Programs
    • Massive Open Online Courses (MOOC)
  • Partnerships
    • Higher Education
    • Enterprise
  • Resources
    • About Us
    • Blog
    • Word Of The Week
    • News and Announcements
    • Newsletter signup
    • Glossary
    • Statistical Symbols
    • FAQs & Knowledge Base
    • Testimonials
    • Test Yourself
Student Login

Blog

Home Blog Of Note: An outlier that lies in the middle of the data

Of Note: An outlier that lies in the middle of the data

An outlier or anomaly is typically defined as a case that is markedly distant or different from the bulk of the data.  Our July 28 blog on outliers and anomaly detection reported on one unusual case in which the outlier might lie fully within the typical data range.

“In one aerospace project, for example, the relevant variables for projecting trajectories included velocity, angle of attack, altitude, yaw, pitch. and roll. It is entirely possible for there to be numerous infeasible or anomalous combinations with individual values that lie within the range for each variable.  For example, a trajectory could have within-range yaw (feasible when taken by itself) at one point, and within-range roll (feasible when taken by itself) at another, yet the combination of the two might be aerodynamically impossible.”

Since then, another famous example of an “outlier in the middle” has been brought to my attention: the Bernie Madoff case. The Madoff fund’s notably consistent positive returns (red line) stood in stark contrast to the S&P market index (blue). Madoff’s returns are well within the range of those of the broader market, what made them an outlier was their lack of volatility.  It was this anomalous consistency (continuous positive returns) that helped bring him to the attention of investigators, who eventually uncovered the pyramid scheme that underlay the Madoff fund.

Madoff Graph

Figure:  Madoff returns (red) contrasted with the S&P 500 (blue).  Researchers also plotted a reconstruction of what Madoff said he was doing (an options-based “split strike conversion” strategy) (source)

Recent Posts

  • Oct 6: Ethical AI: Darth Vader and the Cowardly Lion
    /
    0 Comments
  • Oct 19: Data Literacy – The Chainsaw Case
    /
    0 Comments
  • Data Literacy – The Chainsaw Case
    /
    0 Comments

About Statistics.com

Statistics.com offers academic and professional education in statistics, analytics, and data science at beginner, intermediate, and advanced levels of instruction. Statistics.com is a part of Elder Research, a data science consultancy with 25 years of experience in data analytics.

 The Institute for Statistics Education is certified to operate by the State Council of Higher Education for Virginia (SCHEV)

Our Links

  • Contact Us
  • Site Map
  • Explore Courses
  • About Us
  • Management Team
  • Contact Us
  • Site Map
  • Explore Courses
  • About Us
  • Management Team

Social Networks

Facebook Twitter Youtube Linkedin

Contact

The Institute for Statistics Education
2107 Wilson Blvd
Suite 850 
Arlington, VA 22201
(571) 281-8817

ourcourses@statistics.com

  • Contact Us
  • Site Map
  • Explore Courses
  • About Us
  • Management Team

© Copyright 2023 - Statistics.com, LLC | All Rights Reserved | Privacy Policy | Terms of Use

By continuing to use this website, you consent to the use of cookies in accordance with our Cookie Policy.

Accept