Statistics Definitions > The Delphi method is an intensive questionnaire used to bring a group of experts to a consensus. It is widely used in investment forecasting but has also become commonplace in such diverse fields as medicine, psychology, and…

# Linear Prediction

Time series > Linear prediction is a technique for anlayzing time series; It allows us to predict future values from historical data. It is often used in digital signal processing, because it allows the future values of a signal to…

# Gauss Markov Theorem & Assumptions

Statistics Definitions > Gauss Markov Theorem The Gauss Markov theorem tells us that if a certain set of assumptions are met, the ordinary least squares estimate for regression coefficients gives you the best linear unbiased estimate (BLUE) possible. Gauss Markov…

# Ward’s Method (Minimum variance method)

Clustering > What is Ward’s Method? Ward’s method (a.k.a. Minimum variance method or Ward’s Minimum Variance Clustering Method) is an alternative to single-link clustering. Popular in fields like linguistics, it’s liked because it usually creates compact, even-sized clusters (Szmrecsanyi, 2012).…

# Volatility in Statistics and Markets: Simple Definition, Calculation

Statistics Definitions > Volatility is a measure of change over time. In statistics, it’s used in a few areas, such as differential equations in the OU process. In stock markets, it quantifies a stock’s lack of stability or the tendency…

# NP Chart: Definition & Example

Descriptive Statistics > What is an NP Chart? An NP chart allows a researcher to keep track of whether a measurement process is within bounds or ‘out of control’. It records the number of non conforming units or defective instances…

# Cross Lagged Panel Design: Definition & Example

Experimental Design > Cross lagged panel design is a type of structural equation model where information is collected at two or more points in time. It’s used primarily to assess causal relationships (which may potentially be bi-directional) in a non-experimental…

# Monotone Likelihood Ratio: Definition

Statistics Definitions > The monotone likelihood ratio (MLR) represents a useful data generating process; one where there’s a clear relationship between the magnitude of observed variables and the probability distribution they are drawn from. This clear relationship makes many statistical…

# Mean Value Theorem: How to Use It in Easy Steps

Calculus > Mean Value Theorem You may want to read this article first: What is the Intermediate Value Theorem? What is the Mean Value Theorem? The Mean Value Theorem (MVT) states that if the following two statements are true: A…

# Average Inter-Item Correlation: Definition, Example

Internal Consistency Reliability > Average inter-item correlation is a way of analyzing internal consistency reliability. It is a measure of if individual questions on a test or questionnaire give consistent, appropriate results; different items that are meant to measure the…