6) The R-squared value
can also be interpreted as the average increase in accuracy obtained by using the regression function to estimate the value of Y for the values of X in the data set, rather than using the mean value of Y.
Alpha (see Chapter 32) is calculated using beta, so if the R-squared value
of a fund is low, it is also wise not to trust the figure given for alpha.
Perhaps more revealing as a way to examine predictive ability is to look at out-of-sample forecasting ability of models rather than, or in addition to, "in sample" R-squared values
It is important to note than an improved R-squared value
should not be the only criterion by which a case classification measure is judged.
Now take a look at the R-squared value
of 77% presented in cell B5 of the regression output in Figure 4.
The R-squared value
is approximately only 16% which indicates that export of roundwood is weakly influenced roundwood production.
6) The (Aaa--T) regression has by far the best fit with an R-squared value
In comparison, the square root OLS model yielded the highest R-squared values
, good fits across the Hosmer-Lemeshow deciles, and respectable RMSE and MAE statistics.
In this group almost all R-squared values
are higher that 50%.
In Table 5 and 6 R-squared and Adjusted R-squared values
are close to 0, which means that the links between the evolution of CPI, exchange rate and interest rate are not very strong.