what is dispersion 
the field of statistics is used across every sector and industry to help people better understand and predict potential outcomes in finance investors often turn to statistics to gain a sense of how returns on certain assets or groups of assets could be distributed this range of possible investment returns is called dispersion in other words dispersion refers to the range of potential outcomes of investments based on historical volatility or returns there are two important ways to measure dispersion alpha and beta which calculate risk adjusted returns and returns relative to a benchmark respectively by considering the dispersion of possible investment returns and values such as alpha and beta investors can gain a sense of the risk inherent in a particular security or investment portfolio understanding dispersiondispersion is often interpreted as a measure of the degree of uncertainty and thus risk associated with a particular security or investment portfolio investors have thousands of potential securities to invest in and many factors to consider in choosing where to invest one factor high on their list of considerations is the risk profile of the investment dispersion is one of many statistical measures to give perspective most funds will address their risk profile in their fact sheets or prospectuses which can be readily found on the internet information on individual stocks meanwhile can be found via morningstar and similar stock rating companies 