Trimmed mean
A trimmed mean is the average of a data set computed after discarding a fixed percentage of the smallest and largest observations, making it more resistant to outliers.
See it move
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Ten sorted monthly commission payouts run €500 to €900, the last an unusually large one-off. The ordinary mean of all 10 is €6,120 ÷ 10 = €612. A 10% trimmed mean removes one value from each end, €500 and €900, leaving €520 through €660: €4,720 ÷ 8 = €590. Trimming removes the outlier's pull while keeping more information than the median alone.
Where it fits
TopicDescriptive StatisticsAdvancedSubjectData Analysis & StatisticsAdvanced
The formula
LaTeX
Variables
- Trimmed mean
- Original number of observations
- Number of observations trimmed from each end
Averages the data after discarding an equal number of the smallest and largest observations from each end.