The “average daily return” for people who are taught their first method usually means the arithmetic return (P1/P0 − 1). If so, you do NOT multiply that number by 252 because arithmetic returns are not additive across time. Log returns (log(P1/P0)) are, but people who are using log returns are usually already aware of how Sharpe ratios work.
If your daily returns are so big that ln(P1/P0) is non-negligibly different from P1/P0 − 1, I’m interested in knowing what your investment strategy is. ;-)
If your daily returns are so big that ln(P1/P0) is non-negligibly different from P1/P0 − 1, I’m interested in knowing what your investment strategy is. ;-)
Once you upscale your daily returns by more than two orders of magnitude (that is, multiply them by 250), the difference becomes quite noticeable.