Methodology

Linear Regression Calculation

I finally was able to get the Excel Slope formula to work properly. It seemed wrong to look at Linear Regression numbers without being competent enough to calculate them, even with a computer’s help, so it is good to leave that issue behind.

The formula asks for known x’s and y’s, where x’s are similar to Excel rows and y’s are columns. Prices are defined as y’s and dates as x’s. The problem is that dates don’t work because the market isn’t open every day, so it is necessary to use consecutive integers for the dates.

One would think this information would be readily available on the internet but I was unable to find any site dealing with stock prices and statistics that mention this. Perhaps this is the kind of thing that an average person is expected to know without the need for elucidation.

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