Difference between avg daily return & avg magnitude of returns?

General
1

Hi,
From this context, what’s the Difference between avg daily return & avg magnitude of returns? How did the writer compute the avg magnitude of returns?

Course Name: Options Volatility Trading: Concepts and Strategies, Section No: 10, Unit No: 2, Unit type: WaterMarkVideo

2

Hi,
The average daily return shows the typical gain or loss each day, taking into account whether the return is positive or negative. In contrast, the average magnitude of returns measures how large the daily movements are, regardless of direction. For example, if the returns over three days are +2%, -2%, and 0%, the average daily return is 0% ((2+ -2+0)/3 = 0). However, the average magnitude of returns is about 1.33% — calculated as (2 + |-2| + 0)/3 = 4/3 — since it uses the absolute values of the returns. Hope that makes it clearer.