What are the applications of robust statistics?

What are the applications of robust statistics?

Robust statistics are used in various fields to handle outliers and non-normal data. Common applications include finance, medicine, and environmental science.

Can you give me an example of how it's used in finance?

In finance, robust statistics help in risk assessment by providing reliable estimates of returns even when data contains outliers.

What about in medicine?

In medicine, robust statistics are used in clinical trials to analyze data that may not follow a normal distribution, ensuring valid conclusions.

Are there specific methods or techniques that are considered robust?

Yes, techniques like the median, trimmed means, and M-estimators are considered robust methods that reduce the influence of outliers.

How do robust statistics differ from traditional statistics?

Robust statistics focus on providing reliable results in the presence of outliers, while traditional statistics may be heavily influenced by them.