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A risk analyst is studying a series of graphs plotting the empirical distribution of a portfolio's profit and loss quantiles against the quantiles of different specified reference distributions. The analyst plans to use these QQ plots to gain insights into the properties of the empirical distribution of the portfolio's profits and losses. Which of the following statements is correct regarding QQ plots?
A
The tails of the empirical distribution are heavier than those of the reference distribution if the QQ plot has a steeper slope at its tails.
B
QQ plots are used to smooth the empirical distribution by removing outliers through the use of quantiles.
C
A distribution is considered a good reference distribution if data drawn from it produces a QQ plot that is non-linear in the central mass of the distribution.
D
The primary purpose of a QQ plot is to measure the skewness and kurtosis of the empirical data.