What does “3-sigma” type of event mean? For example,
Hurricane Sandy is a 3-sigma type of event.
Answer
The greek letter sigma is used as a measure (the standard deviation) of how much some series of events vary around the average. Events much bigger or smaller than the average are rarer than events close to the average
For a certain type of statistical distribution you can say that 1/3 of the events will be more than 1 sigma from the average, 5% more than 2 and only 0.3% more than 3 etc etc. It’s only valid for things which follow this particular curve – which hurricanes probably don’t – so in this case it’s a bit of scientific sounding jargon to sound good in a news cast.
It’s popular in the US because there was a business philosophy called 6sigma based on the idea that your business should be 6 standard deviations better than average ( ie 1/500,000,000)
Attribution
Source : Link , Question Author : Tim , Answer Author : mgb
