The median is the middle value of a set of numbers arranged in order, so that half the values lie below it and half above. With an even count it is the average of the two middle values. It is the 50 percent quantile and, with the mean and the mode, one of the three standard measures of the centre of a distribution.
Its value in finance lies in ignoring the size of extremes. Five monthly returns of -8, 1, 2, 3 and 40 percent have a mean of 7.6 percent, driven by one exceptional month, but a median of 2 percent, which better describes a typical month. Analysts therefore quote the median when data are lopsided, as with company valuations in a sector, fund returns, trade sizes or incomes. A gap between mean and median is itself a sign of skewness. Under the lognormal distribution used for share prices, the median future price lies below the mean.