Median
The middle value when everything is lined up in order. Unlike the mean (add up and divide), it isn't pulled around by a few extreme values.
In plain English
Line up nine people by income and the fifth one is the median. The mean adds all the incomes and divides by nine, so one very rich person can drag it far away from what's typical. For lopsided numbers, the median usually describes the typical person better.
Uncle Gary explains
When a billionaire walks into the pub, the average wealth of everyone inside jumps by millions. The median barely moves, and neither does the price of a pint.
Why it matters for your money
'The average investor made money' can be true while most investors lost. Always ask whether an average is the mean or the median.
Where we tested it
- Why Most Drivers Really Can Be Better Than Average
- Lesson 2: The Average and Its Evil Twins
- The Thermostat War: Why Splitting the Difference Pleases Nobody
- Lesson 19: Percentiles, Quartiles and Box Plots: Reading a Distribution at a Glance
Related terms
All glossary terms. Educational content, not financial advice.