# Trimmed Mean

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.

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.

Investment dictionary. . 2012.

### Look at other dictionaries:

• Trimmed estimator — Given a estimator, a trimmed estimator is obtained by excluding some of the extreme values. This is generally done to obtain a more robust statistic: the extreme values are considered outliers.Given an estimator, the n% trimmed version is… …   Wikipedia

• Truncated mean — A truncated mean or trimmed mean is a statistical measure of central tendency, much like the mean and median. It involves the calculation of the mean after discarding given parts of a probability distribution or sample at the high and low end,… …   Wikipedia

• Winsorized Mean — A method of averaging that initially replaces the smallest and largest values with the observations closest to them. After replacing the values, a simple arithmetic averaging formula is used to calculate the winsorized mean. Winsorized means are… …   Investment dictionary

• Robust statistics — provides an alternative approach to classical statistical methods. The motivation is to produce estimators that are not unduly affected by small departures from model assumptions. Contents 1 Introduction 2 Examples of robust and non robust… …   Wikipedia

• Core inflation — is a measure of inflation which excludes certain items that face volatile price movements, notably food and energy. The preferred measure by the Federal Reserve of core inflation in the United States is the core Personal consumption expenditures… …   Wikipedia

• Winsorising — or Winsorization is the transformation of statistics by transforming extreme values in the statistical data, and is named for the engineer turned biostatistician Charles P. Winsor (1895 ndash;1951).The distribution of many statistics can be… …   Wikipedia

• L-estimator — In robust statistics, an L estimator is an estimator which equals a linear combination of order statistics of the measurements.Consider, for example, the median. Given n measurements x 1, ldots, x n, where n is odd, the median equals x… …   Wikipedia

• Linear regression — Example of simple linear regression, which has one independent variable In statistics, linear regression is an approach to modeling the relationship between a scalar variable y and one or more explanatory variables denoted X. The case of one… …   Wikipedia

• Figure skating — is an athletic sport in which individuals, pairs, or groups perform spins, jumps, footwork and other intricate and challenging moves on ice. Figure skaters compete at various levels from beginner up to the Olympic level (senior), and at local,… …   Wikipedia

• Levene's test — In statistics, Levene s test is an inferential statistic used to assess the equality of variance in different samples. Some common statistical procedures assume that variances of the populations from which different samples are drawn are equal.… …   Wikipedia