What is Coefficient of Standard Deviation?
As Standard Deviation is an absolute measure of dispersion, one cannot use it for comparing the variability of two or more series when they are expressed in different units. Therefore, in order to compare the variability of two or more series with different units it is essential to determine the relative measure of Standard Deviation. Two of the relative measures of Standard Deviation are Coefficient of Standard Deviation and Coefficient of Variation.
Coefficient of Standard Deviation is a relative measure of Standard Deviation and is determined by dividing Standard Deviation by the Mean of the given data set. It is also known as the Standard Coefficient of Dispersion.
[Tex]Coefficient~of~Standard~Deviation(\sigma)=\frac{\sigma}{\bar{X}}[/Tex]
Standard Deviation: Meaning, Coefficient of Standard Deviation, Merits, and Demerits
The methods of measuring dispersion such as quartile deviation, range, mean deviation, etc., are not universally adopted as they do not provide much accuracy. Range does not provide required satisfaction as in the entire group, range’s magnitude is determined by most extreme cases. Quartile Deviation does not have algebraic properties and it is also difficult to interpret it. However, Mean Deviation ignores the deviation’s algebraic signs making it unsatisfactory. All these issues increased the need for a measure of dispersion that is free from these shortcomings, which was to some extent solved by Standard Deviation.