Basic Statistics for Traders and Investors

Updated: Jun 4

Some basic knowledge in statistics is required in order to understand what an actual data point really indicates. Here is a short explanation of the most important terms:


Mean (also average): is calculated by taking the sum of data values and dividing that sum by the total number of data values.


Median: is calculated by sorting the data set in ascending numerical order and identifying the middle number.


Mode: A mode is the number that appears most frequently in a given data set.

For examples and further explanation: click here


Percentile rank: of a value refers to the percentage of values in its frequency distribution that are lower than or equal to it. (wikipedia)



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