Absolute Return Measures

Monthly Return (Arithmetic Mean): A simple average return (arithmetic mean) that is calculated by summing the returns for each period, and dividing the total by the number of periods. The simple average return does not consider the compounding effect of returns.

Monthly Return

Investors who are required to select and monitor investment managers should develop a basic understanding of investment statistics. Quantitative tools can provide you with good insight that you can use in your qualitative interviews with managers and when monitoring your investments.