Correlation

Definition of Correlation

Correlation- Definition:

• A correlation is a statistical measure of how closely two variables are related. It is a number that ranges from -1 to +1, with -1 indicating a perfect negative correlation, 0 indicating no correlation, and +1 indicating a perfect positive correlation.
• To calculate a correlation, you first need to calculate the correlation coefficient, which is a mathematical calculation that takes into account the direction and strength of the correlation. The correlation coefficient can be positive or negative, but the sign (positive or negative) doesn’t indicate whether the correlation is good or bad. It just indicates the direction.
• Once you have the correlation coefficient, you can interpret it by looking at the magnitude (the size of the number) and the sign (positive or negative). If the magnitude is high and the sign is positive, that means the correlation is strong and positive. If the magnitude is high and the sign is negative, that means the correlation is strong and negative. If the magnitude is low, that means the correlation is weak.

Correlation in Statistics

• In statistics, correlation is the degree to which two factors are related. It is measured by a statistic called the correlation coefficient, which ranges from -1 to +1. A correlation of +1 means that the two factors are perfectly related; a correlation of -1 means that the two factors are perfectly inversely related. A correlation of 0 means that there is no relationship between the two factors.
• The correlation coefficient is a measure of the strength of the relationship between two factors. It is calculated by taking the covariance of the two factors and dividing it by the product of the standard deviations of the two factors. The covariance is the average of the product of the two factors’ deviations from their mean, and the standard deviation is the square root of the variance.
• The correlation coefficient is usually denoted by the symbol r.

Linear Correlation Coefficient Formula

The linear correlation coefficient formula is used to calculate the correlation coefficient between two variables. The linear correlation coefficient is a measure of the linear relationship between two variables. The linear correlation coefficient ranges from -1 to 1, with a value of 0 indicating no linear relationship between the two variables.