FRM: Coefficient of determination (r-squared)
In a linear regression, you often see the R-squared quoted. To explain the R-squared (coefficient of determination), I compare it to the standard error of estimate (a measure of the line's accuracy) and the correlation (the square root of the coefficient of determination). All three are measures of the line's fit to the data. For more financial risk videos, visit our website! http://www.bionicturtle.com