Arithmetic Mean

The evil twin of arithmetic nice. A fancy term for the average of a group of numbers. Yeah, seriously, you add up all the numbers and divide the total by how many numbers you have.

In three consecutive months, we showed percentage returns of 3.2%, 1.7% and 0.05%. Our average return over those three months can be found by adding 3.2, 1.7, and 0.05 to get 5.4, and then dividing that by 3 to get an average return over the three months of 1.8%. That’s all. Move along. There’s nothing more to see here.