We analyse the kinematics of \sim 400 000 stars that lie within \sim 2 { kpc } of the Sun and have spectra measured in the RAdial Velocity Experiment ( RAVE ) .
We decompose the sample into hot and cold dwarfs , red-clump and non-clump giants .
The kinematics of the clump giants are consistent with being identical with those of the giants as a whole .
Without binning the data we fit Gaussian velocity ellipsoids to the meridional-plane components of velocity of each star class and give formulae from which the shape and orientation of the velocity ellipsoid can be determined at any location .
The data are consistent with the giants and the cool dwarfs sharing the same velocity ellipsoids , which have vertical velocity dispersion rising from 21 { km } { s } ^ { -1 } in the plane to \sim 55 { km } { s } ^ { -1 } at |z| = 2 { kpc } and radial velocity dispersion rising from 37 { km } { s } ^ { -1 } to 82 { km } { s } ^ { -1 } in the same interval .
At ( R,z ) the longest axis of one of these velocity ellipsoids is inclined to the Galactic plane by an angle \sim 0.8 \arctan ( z / R ) .
We use a novel formula to obtain precise fits to the highly non-Gaussian distributions of v _ { \phi } components in eight bins in the ( R,z ) plane .

We compare the observed velocity distributions with the predictions of a published dynamical model fitted to the velocities of stars that lie within \sim 150 { pc } of the Sun and star counts towards the Galactic pole .
The predictions for the v _ { z } distributions are exceptionally successful .
The model ’ s predictions for v _ { \phi } are successful except for the hot dwarfs , and its predictions for v _ { r } fail significantly only for giants that lie far from the plane .
If distances to the model ’ s stars are over-estimated by 20 per cent , the predicted distributions of v _ { r } and v _ { z } components become skew , and far from the plane broader .
The broadening significantly improves the fits to the data .

The ability of the dynamical model to give such a good account of a large body of data to which it was not fitted inspires confidence in the fundamental correctness of the assumed , disc-dominated , gravitational potential .