Option Investor
Glossary

A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z

Simple Moving Average

The basic definition of a moving average is that it is the average price of a security at a specific point in time. The purpose of the moving average is to show a trend over a given time period and display it in a smoothed fashion. There are many types of moving averages but the most common is the 'simple' average (not weighted) that is based on the closing price of the stock for that particular day.