Categorical Variable
From Open Risk Manual
Revision as of 13:53, 16 April 2021 by Wiki admin (talk | contribs)
Definition
A Categorical Variable in the context of Quantitative Risk Management is any variable that ranges along a finite number of possible values. Categorical variables can be used in the representation of a Risk Model, encoding Explanatory Variables, Risk Factor or Risk Metric
Numerical Variables can be converted to categorical variables of the Ordinal variety via various discretization (binning) methods