DEFINITION of 'Harmonic Average'

The mean of a set of positive variables. Calculated by dividing the number of observations by the reciprocal of each number in the series.

Also known as "harmonic mean".

BREAKING DOWN 'Harmonic Average'

Alternately, the harmonic average could be thought of as the reciprocal of the arithmetic mean of inverse values.

RELATED TERMS
  1. Reciprocal Insurance Exchange

    A form of insurance organization in which individuals and businesses ...
  2. Sectoral Reciprocity

    A trade agreement between two countries to reduce or eliminate ...
  3. Reciprocal Currency Arrangement

    Temporary arrangement between central banks to maintain a supply ...
  4. Reciprocal Statutes

    Legislation enacted between two or more states promoting commerce. ...
  5. Arithmetic Mean

    A mathematical representation of the typical value of a series ...
  6. Mean

    The simple mathematical average of a set of two or more numbers. ...
Related Articles
  1. Investing

    Calculating the Arithmetic Mean

    The arithmetic mean is the average of a sum of numbers.
  2. Investing

    Using Fibonacci to Analyze Gold (GLD, GC)

    Use Fibonacci studies to analyze gold by picking out hidden harmonic levels that can provide major support or resistance.
  3. Investing

    Breaking Down The Geometric Mean

    Understanding portfolio performance, whether for a self-managed, discretionary portfolio or a non-discretionary portfolio, is vital to determining whether the portfolio strategy is working or ...
  4. Trading

    How To Make The Most of Fibonacci Grids (VDSI, GLW)

    Build your Fibonacci skills by finding the longest price swing on your chart of interest and placing a grid over the trend. Repeat at shorter intervals.
  5. Trading

    Harmonic Patterns In The Currency Markets

    Learn how to take geometric price patterns to the next level by using Fibonacci numbers to predict movements in the forex market.
  6. Investing

    Calculating The Means

    Learn more about the different ways you can calculate your portfolio's average return.
  7. Trading

    What To Do With Stocks That Hit All-Time Highs

    Apply this specialized set of risk management and technical rules when your positions are trading at new highs.
  8. Investing

    The Most Accurate Way To Gauge Returns: The Compound Annual Growth Rate

    The compound annual growth rate, or CAGR for short, represents one of the most accurate ways to calculate and determine returns for individual assets, investment portfolios and anything that ...
  9. Investing

    What's a Sensitivity Analysis?

    Sensitivity analysis is used in financial modeling to determine how one variable (the target variable) may be affected by changes in another variable (the input variable).
  10. Investing

    Fibonacci: Using Math To Make Right Market Moves

    Use these two original Fibonacci techniques to pinpoint the patterns in stock movements, and the most reliable entry and exit levels.
RELATED FAQS
  1. Can two numbers have the same arithmetic and geometric means?

    Learn about the often complicated relationship between the geometric mean and arithmetic mean for a set of numbers, and which ... Read Answer >>
  2. What is the difference between arithmetic and geometric averages?

    An arithmetic average is the sum of a series of numbers divided by the count of that series of numbers. If you were asked ... Read Answer >>
  3. What variables are most important when making a prediction through sensitivity analysis?

    Explore sensitivity analysis and how this method considers different variables to determine a course of action based on statistical ... Read Answer >>
  4. What is a geometric mean in statistics?

    Learn what the geometric mean is in statistics and how it is used to calculate various growth rates and returns by financial ... Read Answer >>
  5. How do you calculate the geometric mean to assess portfolio performance?

    Learn how to calculate the geometric mean. Understand when the geometric mean should be used and how it differs from the ... Read Answer >>
Hot Definitions
  1. Federal Direct Loan Program

    A program that provides low-interest loans to postsecondary students and their parents. The William D. Ford Federal Direct ...
  2. Cash Flow

    The net amount of cash and cash-equivalents moving into and out of a business. Positive cash flow indicates that a company's ...
  3. PLUS Loan

    A low-cost student loan offered to parents of students currently enrolled in post-secondary education. With a PLUS Loan, ...
  4. Graduate Record Examination - GRE

    A standardized exam used to measure one's aptitude for abstract thinking in the areas of analytical writing, mathematics ...
  5. Graduate Management Admission Test - GMAT

    A standardized test intended to measure a test taker's aptitude in mathematics and the English language. The GMAT is most ...
  6. Magna Cum Laude

    An academic level of distinction used by educational institutions to signify an academic degree which was received "with ...
Trading Center