Investment Studio > Expressions > Functions > Statistical > GEOMEAN
float geomean(float data [, ...])
Returns the geometric mean of the data: given N data points,
geomean = (data1 * data2 * ... * dataN)^(1 / N)
No value in the argument list may be < 0.
All elements in the argument list are converted to floats, with exclusion if conversion fails. The list may contain array arguments, in which case each array element is treated as a separate list element.
While the arithmetic mean (see average) answers the question "if all the data points had the same value, what would that value have to be in order to leave the sum of all data points unchanged?", the geometric mean answers the question "if all the data points had the same value, what would that value have to be in order to leave the product of all data points unchanged?".
For instance, the geometric mean can be used to compute the average growth rate given compund interest with different rates for different periods.
Example
The average growth rate with compund interest and rates of 7%, 6.5%, 5%, 4%, and 2.5% is
=geomean(1.07, 1.065, 1.05, 1.04, 1.025) - 1
» 4.98%.