By Dr. David Edward Marcinko MBA MEd CMP™
SPONSOR: http://www.MarcinkoAssociates.com
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R-squared is an investment portfolio performance and risk measure that indicates how much of a portfolio’s performance fluctuations were attributable to movements in the portfolio’s benchmark index. R-squared can range from 0-100%.
CITE: https://www.r2library.com/Resource/Title/0826102549
IOW: R Squared, also known as the coefficient of determination, is a statistical measure used in the context of regression analysis. It represents the proportion of the variance in the dependent variable that is predictable from the independent variable(s). Essentially, it provides a measure of how well the observed outcomes are replicated by the model, based on the proportion of total variation of outcomes explained by the mode
For example, an R-squared of 100% indicates that all portfolio performance movements were attributable to movements in the benchmark index—they correlate perfectly to the benchmark.
Conversely, an r-squared of 0% indicates that there is no correlation between the performance movements of the portfolio and the benchmark.
Cite: http://www.CertifiedMedicalPlanner.org
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