Statistical Concepts for Finance

MEAN

Mean is the arithmetic average of all the values in a data set. If there are 'N'
elements of data (Xi) in the data set, then the mean ( X ) is given by
X = sum of Xi/N, where i = 1, 2, 3, ……..., n

GEOMETRIC MEAN

Geometric Mean (GM) is theoretically considered to be the best average in
measuring returns from securities. It is also considered more appropriate in
averaging ratios and percentages. It is defined as the nth root of the product
of 'N' items. If there are two items, square root is taken; if there are three
items, then cube root and so on.

Coming up Standard Deviation of Return......