## R-squared (R2)

R-squared, also called the coefficient of determination, is that the statistical dimension of the correlation medially an investment's functionality along with a particular benchmark index. To put it differently, it reveals what level a share or portfolio's performance could result from a standard indicator.
Definition - What is R-Squared?
Specifically, this linear regression is used to ascertain how well a lineup matches to a data set of observations, especially when comparing models. Also, it is the fraction of the total variation in y that is captured by a model. Or, how well does a line follow the variations within a set of data.
Formula
The R-squared formula is calculated by dividing the sum of the before all else errors by the sum of the second errors and subtracting the deri...