What are mean and median in trading?
In one line: The mean is the average of a set of numbers. The median is the middle value when they're lined up in order. Big outliers move the mean but barely move the median.
The idea
Mean = add everything up, divide by how many.
Median = line them up in order and take the middle one.
Most days they're close. In trading, they often aren't.
A simple example
5 trades, in units of risk (R): −1, −1, −1, −1, +8.
Mean: (−1 − 1 − 1 − 1 + 8) ÷ 5 = 4 ÷ 5 = +0.8R per trade.
Median: lined up, the middle (3rd) result is −1R.
The mean says "good average." The median says "the typical trade loses." Both are true. One big win is carrying the whole set. A math example, not a promise.
With an even count, the median is halfway between the two middle values. For −1, −1, +2, +3 that's (−1 + 2) ÷ 2 = +0.5R.
Why it matters
The mean is what drives your Expectancy. The median tells you what most trades feel like.
That gap matters:
- If most trades lose small and a few win big, you'll spend a lot of time in small dips. Be ready for it, or you'll quit early.
- If the mean depends on 1 or 2 huge wins, those wins may be rare. Remove the biggest one and see what's left.
A common mistake
Trusting a mean built on one outlier. Try this check: take your journal, remove the single best trade, and recompute. If the average flips from positive to negative, your sample size is probably too small to judge. Keep logging. See how to keep a trading journal.
Log every result as an R-multiple. Then mean, median and spread each take one line of math, for any account size.
To see how spread out results are, see standard deviation.
Questions
Should traders use the mean or the median?
Both. The mean drives your long-run average. The median shows what a typical trade looks like. A big gap between them means a few outliers are doing the heavy lifting.
Why is my average win much bigger than my median win?
A few very large wins pull the average up. The median ignores how big they are, so it stays closer to a normal win.
Is expectancy a mean?
Yes. Expectancy is the mean result per trade, usually measured in units of risk.
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