How To Calculate Geometric Mean Rate Complete Guide

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how to calculate geometric mean rate. Where R1 R2 and Rn are sub-period returns for period 1 2 and n respectively and. It is calculated as.

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Katex is not defined Where r is the rate of return and n is the number of periods. In order to find the geometric mean multiply all of the values together before taking the n th root where n equals the total number of values in the set. The easiest way to think of the geometric mean is that it is the average of the logarithmic values converted back to a base 10 number.

N is the total number of sub-periods for which return is available.

10310510899110 15 or 2-1 493. For example to calculate the geometric mean of the values 12 -8 and 2 instead calculate the geometric mean of their decimal multiplier equivalents of 112 092 and 102 to compute a geometric mean of 10167. Geometric Mean 13276 If we find the geometric mean of 12 13 and 15 we get 13276. This should be interpreted as the mean rate of growth of the bacteria over the period of 3 hours which means if the strain of bacteria grew by 3276 uniformly over the 3 hour period then starting with 100 bacteria it would reach 234 bacteria in 3 hours.