Table of Contents
What Is the Coefficient of Variation?
The coefficient of variation (CV) is a standardized measure of dispersion expressed as a percentage of the mean. It allows comparison of variability between datasets with different units or vastly different means. A dataset with CV=10% is more consistent than one with CV=30%.
CV is widely used in finance (risk assessment), quality control (process consistency), laboratory science (measurement precision), and ecology (population variability).
Formula
Interpretation
| CV | Variability |
|---|---|
| < 10% | Low |
| 10-20% | Moderate |
| 20-30% | High |
| > 30% | Very high |
FAQ
When should I use CV instead of standard deviation?
Use CV when comparing variability between datasets with different units (e.g., height in cm vs weight in kg) or very different means. Standard deviation alone cannot make such comparisons meaningful.
Can CV be used for data with zero mean?
No. CV is undefined when the mean is zero or near zero. In such cases, use other measures like the standard deviation or MAD.