The Check-Up Application of Statistical Science: "Standard Deviation" Measuring the Heartbeat
Sometimes the weather of two different cities also comes out as average "20 Degrees". But one is between 18 and 22 (Soft), the second city is scorched and frozen between Night (0) and Day (40). The Average of both is 20, but their real faces are as different from each other as night and day. Here the formula that puts the mask on this insidious two-facedness (lying) of the arithmetic mean and hits the real reality in your face is called "Standard Deviation and Variance". It measures how much the stability is broken by the outlier extremities (excessively high or excessively low irregularities) thrown from the outside into your data list.
Why Is Variance Looked at in Stock Market, Investment, and Crypto World (Volatility)?
You are going to buy a stock (e.g.: Apple). It goes up and down 1 Dollar every day. There is also a new crypto currency; it shoots up 50 Dollars one day and crashes 80 Dollars down the next day. Stock market traders call these crashes "Volatility". The mathematical equivalent is "Asset with High Standard Deviation". If you invest your money in assets with high deviation, you might die of a heart attack (High Return/High Risk). Those looking for a safe haven (Gold etc.) lean towards more steep straight lines with very low standard deviation.
Quality Control and Factory Standards (For the Sake of Six Sigma!)
Imagine a car part facility; they need to produce 100 cm screws. Just because the screws coming out of the lathe come out as (101 cm, 99 cm, 98 cm) and the Average looks like 100, the boss can't say "We are great!". Because the deviation of those screws (i.e., 10% defect) points to billions of dollars of loss for the factory. The variance formulas in the background transmit the "Danger alarm (Out of tolerance)" signal to the engineers with bells. In short, this page is the digital laboratory that lines up every mathematical series imaginable, from the efficiency of a company to the intelligence test (IQ Distribution) in the faculty of education.