Hello, this is my first post, but surely not my last as I prepare for Level 1 in June. Can someone expound on the Harmonic Mean and why its important, when there seem to be so many other excellent ways of determining the mean value or return or whatever? Thanks!
Of course, but then there would be no point for this forum, huh?
Read book on algebra by HALL and KNIGHT…
You know, why do people like you act like that when someone tries to get help with an honest question? Do you stalk online all day at work, waiting for people to smack down for asking a “stupid” question? All I care about is being able to recognize on the exam when to use the harmonic mean calculation and when not to-- I don’t need any harrassment from any people who get off on making other folks feel dumb.
Agree that this forum would be a LOT more useful if people could skip over the posts they didn’t want to contribute to rather than being juvenile and snide.
Harmonic mean is absolutely important and relevant. It has to do with Dollar Cost Averaging which you better be aware of. Dollar Cost Averaging Example: Share price volatility over the course of three months: Period 1: $100 @ $5/share = 20 shares Period 2: $100 @ $1/share = 100 shares Period 3: $100 @ $4/share = 25 shares ========================= Spent: $300, for 145 shares (at $4/share = $580, so 93% Return, but that’s irrelevant) Anyway, spent $300 for 145 shares. Average share price: ~$2.07 Harmonic mean: N/ (Sum{(1/Xi)}) so: $300/([$100/$5] + [$100/$1] + [$100/$4]) = ~$2.07 Or: 3/(1/5 + 1/1 + 1/4) = ~2.07