Data Exploration

Introduction Many statistical tests assume normality within the data set.  In other words, before you perform any type of parametric test, one should first view the data sets and run experiments to test this assumption.  This article will show you how to pull several market indices’ historical returns and see if they follow a normal distribution using the Shapiro-Wilk test. The main reason this article is testing the normal distribution validity of portfolio returns is to set up Monte Carlo simulations to project future retirement balances and their respective probabilities in Tableau.   To view the interactive application and estimate your own retirement savings, click here .   Sources:  Normality Test in R Analyzing Performance with tidyquant Market Index Background We were able to pull the following historical index information using a convenient package in R called tidyquant .  We will test the normality of the various benchmarks listed below...