Learn about the negative correlation coefficient, its significance, comparison with other coefficients, and real-world ...

Almost every day you can find in media commentary that XYZ is causing stocks to fall (or rise). Such definitive statements are common—but what’s almost always missing is statistical proof. And if you ...

Jason Fernando is a professional investor and writer who enjoys tackling and communicating complex business and financial problems. David Kindness is a Certified Public Accountant (CPA) and an expert ...

Correlation coefficients range from -1 to +1, indicating the strength of relationships between variables. Investors use correlation coefficients for portfolio diversification to reduce risk.

Despite the chant that correlation is not causation, some researchers believe the design of scatter plots nudges us to the wrong conclusions. Can a change in their design lessen that risk? Analyzing ...

Once the ranks for the two variables are found, we apply the formula for the correlation to the ranks as follows: Both Spearman’s rank and Pearson’s correlation tests share the purpose of assessing ...

Correlation vs Regression: Both correlation and regression are two powerful tools of statistics and data analysis used to understand the relationships between variables. However, they serve distinct ...

In the first case, there is a strong upward-sloping relationship between X and Y; in the second case, no apparent relationship; in the third case, a strong downward-sloping relationship. Note the ...