Represents the annualized total return for a fund over 3-, 5, and 10-year time periods.
Benefits
Origin
Morningstar calculates this figure in-house, using a geometric average. The formula for the geometric mean is [
] x 100
Where:
n = number of months
Cumulative total return = 
For the Pros
Investors have varying degrees of risk tolerance, yet they will always seek the maximum rate of return available on their investment. Mean is also commonly referred to as expected return, and is what an investor hopes to maximize for any given measure of risk.
A Note About Standard Deviation
Morningstar uses the arithmetic mean of a fund rather than the geometric mean above to calculate standard deviation. Thus, the standard deviation figures Morningstar provides in our database can not be calculated using the mean figures listed. See the definition of standard deviation for a more complete explanation.