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Market Breadth Analysis
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VALUE LINE INDEX, GEOMETRIC & AVERAGE
Average is a commonly used and well understood statistic, MEDIAN is also a common descriptor used to express a 'middle' value in a set of data. This 'middle' value is also known as the central tendency. Median is determined by ranking the data from largest to smallest, and then identifying the middle so that there are an equal number of data values larger and smaller than the middle value. A group of numbers in order from highest to lowest would be represented as: (x1, x2, x3, x4, x5). The median number would be x3 because it is in the middle of the group, with 2 numbers above and below x3.
Average is calculated by adding all of the numbers together (x1 + x2 + x3 + . . . Xn) and then dividing this total by the number of units (Xn) in the group.
In real estate, the median is always preferable, so too is the median better in the stock market.
In calculating average or median income in the USA, would you think average would be better than median? Answer is the median because the upper 1% has a LARGE income skewed to the upside.
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