The formula to calculate the Moving Average is:
\[ \text{Moving Average} = \frac{\sum_{i=0}^{n-1} x_i}{n} \]
Where:
The moving average is a statistical measure used to analyze data points by creating a series of averages of different subsets of the full data set. It helps smooth out short-term fluctuations and highlight longer-term trends or cycles.
Consider an example where the data points and window size are:
Using the formula to calculate the Moving Average:
\[ \text{Moving Average} = \left( \frac{2+4+6}{3}, \frac{4+6+8}{3}, \frac{6+8+10}{3} \right) = (4, 6, 8) \]
This means that the moving averages for this example are 4, 6, and 8.