# Excess kurtosis

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## Excess kurtosis

Kurtosis measures the "fatness" of the tails of a distribution. Positive excess kurtosis means that distribution has fatter tails than a normal distribution. Fat tails means there is a higher than normal probability of big positive and negative returns realizations. When calculating kurtosis, a result of +3.00 indicates the absence of kurtosis (distribution is mesokurtic). For simplicity in its interpretation, some statisticians adjust this result to zero (i.e. kurtosis minus 3 equals zero), and then any reading other than zero is referred to as excess kurtosis. Negative numbers indicate a platykurtic distribution; positive numbers indicate a leptokurtic distribution.

## Excess Kurtosis

A measure of the fatness of the tails of kurtosis where there is higher likelihood of large gains or large losses on an investment. That is, excess kurtosis indicates that the volatility of the investment is itself highly volatile.

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