Regression Analysis
Definition
A statistical method to model and quantify the relationship between a dependent variable and one or more independent variables. Used to identify factors driving asset price movements and forecast returns.
Formula / Rules
Y = α + βX + ε (simple linear regression)
Example
Regression analysis can quantify how much a 1% rise in interest rates historically affects a REIT's stock price.
Related Terms
Frequently Asked Question
What is Regression Analysis in finance?
Regression quantifies the statistical relationship between variables. In finance: Y = α + βX + ε. Used to estimate beta, factor exposures, and build predictive models for returns.
APA Citation
Last updated:
· Source: VixShield Trading Glossary — From SPX Mastery by Russell Clark
⚠️ Not financial advice. This definition is educational content from the SPX Mastery book series by Russell Clark (VixShield). Past performance is not indicative of future results. Trading options involves substantial risk of loss and is not appropriate for all investors. Always paper trade before risking real capital.