Description: The concept of Standard Deviation was introduced by Karl Pearson in 1893. It is by far the most important and widely used measure of dispersion.

How was standard deviation invented?

It is all due to a historical accident: in 1893, the great Karl Pearson introduced the term "standard deviation" for what had been known as "root mean square error". The confusion started then: people thought it meant mean deviation. ... But we adjust with stochastic volatility where STD is often as high as 1.6 times MAD.

What is the concept of standard deviation?

A standard deviation (or σ) is a measure of how dispersed the data is in relation to the mean. Low standard deviation means data are clustered around the mean, and high standard deviation indicates data are more spread out.