DEFINITION of 'Trimmed Mean'
A method of averaging that removes a small percentage of the largest and smallest values before calculating the mean. After removing the specified observations, the trimmed mean is found using an arithmetic averaging formula.
INVESTOPEDIA EXPLAINS 'Trimmed Mean'
The trimmed mean looks to reduce the effects of outliers on the calculated average. This method is best suited for data with large, erratic deviations or extremely skewed distributions. A trimmed mean is stated as a mean trimmed by X%, where X is the sum of the percentage of observations removed from both the upper and lower bounds.
For example, a figure skating competition produces the following scores: 6.0, 8.1, 8.3, 9.1, 9.9. A mean trimmed 40% would equal 8.5 ( (8.1+8.3+9.1)/3 ), which is larger than the arithmetic mean of 8.28. To trim the mean by 40%, we remove the lowest 20% and highest 20% of values, eliminating the scores of 6.0 and 9.1. As shown by this example, trimming the mean can reduce the effects of outlier bias in a sample.

Standard Deviation
1. A measure of the dispersion of a set of data from its mean. ... 
Winsorized Mean
A method of averaging that initially replaces the smallest and ... 
Skewness
Describe asymmetry from the normal distribution in a set of statistical ... 
Arithmetic Mean
A mathematical representation of the typical value of a series ... 
Mean
The simple mathematical average of a set of two or more numbers. ... 
Harmonic Average
The mean of a set of positive variables. Calculated by dividing ...

Retirement
Combining Your Plan Assets? Not So Fast!
You might reduce the costs of maintaining more than one account, but you could also be forfeiting tax benefits. 
Mutual Funds & ETFs
5 Ways To Measure Mutual Fund Risk
These statistical measurements highlight how to mitigate risk and increase rewards. 
Personal Finance
Revive Your Portfolio
Increase your annual returns by rebalancing your investments now. 
Options & Futures
Financial Concepts
Diversification? Optimal portfolio theory? Read this tutorial and these and other financial concepts will be made clear. 
Fundamental Analysis
What are the most common issues with Serial Correlation in stocks?
Read about the concept of serial correlation in stock returns, and learn why market analysts are divided about the efficacy of trading based on stock patterns. 
Bonds & Fixed Income
How do I calculate yield to maturity of a zero coupon bond?
Find out how to calculate the yield to maturity for a zero coupon bond, and see why this calculation is more simple than a bond with a coupon. 
Trading Strategies
How far back in a stock's history should you go when gauging its volatility?
Discover why it can be difficult for investors to figure out how far back to go into a stock's history when gauging its volatility. 
Fundamental Analysis
What does the term 'invisible hand' refer to in the economy?
Discover and understand the concept of the "invisible hand" as explained by Adam Smith, considered the founder of modern economic theory. 
Fundamental Analysis
At what level is the current account deficit considered excessive, in terms of percent?
Take a deeper look at the variables that impact current account deficits, and learn why not all types of deficits have equal impacts on a nation's economy. 
Trading Strategies
What are common examples of Serial Correlation in finance?
Take a deeper look at serial correlation in finance, and find out why most attempts at discovering serial correlation among asset prices have failed.