How to Accurately Calculate a Monthly Running Average

Learn how to calculate a monthly running average for clearer trend insights in your data analysis.

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To calculate a monthly running average, sum all the values for the specific month over a given period (such as the last 12 months) and divide this sum by the number of periods. For example, if you have monthly sales data for one year, add each month's sales and then divide by 12. This method smooths out short-term fluctuations, giving a clearer view of trends.

FAQs & Answers

  1. What is a running average? A running average is a calculation to analyze data points by creating averages of different subsets over time.
  2. Why use a monthly running average? Using a monthly running average helps to smooth out fluctuations in data, making trends clearer for better decision-making.
  3. Can a running average be applied to other time frames? Yes, a running average can be calculated for any time frame, such as weekly or quarterly, depending on the data frequency required.
  4. What data can I apply a running average to? Running averages can be applied to various datasets, including sales figures, web traffic, or any other time-series data.

Watch More

For further insights on improving your data analysis skills, check out our guides on calculating financial ratios and interpreting statistical data.

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