# Unconditional Probability

## What it is:

Unconditional probability refers to the chance that a particular event will occur without regard to external circumstances.

## How it works (Example):

The outcome of a single event can be affected by any number of accompanying conditions. Unconditional probability is the likelihood that an event will end with a specific result irrespective of other conditions that may be present.

Unconditional probability is calculated by dividing the instances of a definite outcome by the total number of events. For example, if a die lands on the number five 15 times out of 60 , the unconditional probability of landing on the number five is 25% (15 outcomes /60 total lots = 0.25).

## Why it Matters:

Unconditional probability calculates the likelihood you'll get a particular outcome even if you can't know what specific external conditions exist. Traders use unconditional probability to gauge the eventual profitability of a security.

Related Terms View All
• Though most of the trading is done via computer, auction markets can also be operated via...
• Let's assume you place an order to buy 100 shares of Company XYZ stock. The current quote...
• Savings bonds are bonds issued by the U.S. government at face values ranging from \$50 to...
• The basic idea behind break-even point is to calculate the point at which revenues begin...
• If Company XYZ starts its fiscal year on January 1 and ends its fiscal year on December...