CFA L2: Quantitative Methods - Introduction- The title of this section really just says “applied statistics for financial analysis.” Some of the...

## COURSE

## Quantitative Methods

- **Correlation** - Correlation is math-speak for relationships. Is there a relationship between t...
- - This is the “least squares” method. - Situational Example: - “If a country’s broad stock i...
- - Also called Standard Error of the Regression - Conceptually SEE helps to measure how imperfect...
- - In all likelihood, your model will not perfectly predict Y. - The [SEE](https://financetrain.c...
- - Typically noted as R2yx or R-squared in the stats report. - This value measures the percentage...
- This is a tool to review a regression analysis and decompose the contribution of the variation in th...
- Much of the concepts in simple regression are applicable, but watch out when determining your degree...
- - For a multiple regression model, this value represents the percentage of total variation in Y th...
- - A statistically significant Fcalc (i.e. one that passes the Fcritical threshold, based on your d...
- **Heteroskedasticity** There are two types, Conditional and Unconditional. The type focused on in ...
- - Handle qualitative independent variables with a quantitative proxy or use a dummy variable. - ...
- **Simple Time Series Models** - This is basic trend modeling. A simple trend model can be expres...
- - Auto-Regressive (AR) Time Series Models - This type of time series model utilizes a time perio...
- - This is the case of an AR time series model where the predicted value is expected to equal the p...
- - Autoregressive Moving Average Model (ARMA) = calculates an average value over a period of time t...
- - **Simple Linear and Exponential Growth Models** – If an analyst looks at a time series plot grap...

## LESSONS

Quants: Correlation Analysis

Quants: Single Variable Linear Regression Analysis

Standard Error of the Estimate or SEE

Confidence Intervals (CI) for Dependent Variable P...

Coefficient of Determination (R-Squared)

Analysis of Variance or ANOVA

Multiple Regression Analysis

Multiple Regression and Coefficient of Determinati...

Fcalc – the Global Test for Regression Significanc...

Regression Analysis and Assumption Violations

Qualitative and Dummy Variables in Regression Mode...

Time Series Analysis: Simple and Log-linear Trend ...

Auto-Regressive (AR) Time Series Models

Auto-Regressive Models - Random Walks and Unit Roo...

ARMA Models and ARCH Testing

How to Select the Most Appropriate Time Series Mod...