Geometric Average Return

A Geometric Average Return is the constant return applied to each period in a range that would result in the compounded return over that range.

The Geometric Average Return is calculated using the formula below:

g_n = ( 1 + r_c)^1/n - 1

Where

g_n = the Geometric Average Return applicable on each subset period n

r_c = the cumulative return over the entire period

n = the number of equal subset periods to average the return