FTB-C000304 / Statistical method

Weighted Mean

Weighted Mean is the sum of value-weight products divided by the sum of their eligible weights.

Also known asweighted average

Definitions

In plain terms

It lets observations contribute unequally while retaining the input's measurement unit.

Technical

The calculation requires aligned values and weights, declared sign rules, normalization, missing-pair policy, and a nonzero total weight.

Scope

A weighted mean does not specify where its weights come from.

Formula

Weighted mean = sum(w_i * x_i) / sum(w_i)
LaTeX: \bar{x}_w=\frac{\sum_i w_i x_i}{\sum_i w_i}
SymbolMeaningUnit
w_iweight for observation iweight
x_iobservation iinput unit

Output unit: input unit

Examples

  • A governed lesson uses Weighted Mean only with declared inputs, timing, parameters, and edge-case behavior.

Common misconceptions

  • A weighted mean does not specify where its weights come from.

Concept relationships

Where this concept is used

Evidence and governance

  1. Weighted Mean NIST · official standard

    Supports: preferred label, short definition, technical definition, formula

    Limits: The reference does not choose the newest-heavy linear weights used by one technical-analysis WMA convention.

Reviewed by
fintech-builder-batch-006
Last reviewed
2026-07-27
Next review
2027-07-27
Record status
evidence reviewed

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