The Student’s T-distribution looks much like a normal distribution but generally has fatter tails. Fatter tails allow for a higher dispersion of variables, as there is more uncertainty.
The Student’s T distribution was one of the biggest breakthroughs in statistics, as it enabled inference through small samples with an unknown population variance. This setting can be applied to most of the statistical problems we face today.
Other related topics you might be interested to explore are Normal distribution and Confidence intervals.
This is an open-access Excel template in XLSX format that will be useful for anyone who wants to work as a Statistician, Business Intelligence Analyst, Data Scientist, Portfolio Manager, or Risk Manager.
You can now download the Excel template for free.
Student’s T-distribution is among the topics included in the Quantitative Methods module of the CFA Level 1 Curriculum.