课程: Using Data in Financial Analysis

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Confidence intervals around the result

Confidence intervals around the result

- [Instructor] Once we have our basic regression done, our next step in a practical finance setting is oftentimes trying to go through and use that regression to do a sales forecast. So how can we do this? Let me show you how this works in Excel. I'm in the 04_02_Begin Excel file. Now, we've gone through and run our regression, where our y variable is sales, and it's based on a series of x variables from some data we've collected. And this covers about 391, 392,000 different data points using 12 different variables ranging from assets and liabilities to Tobin's Q, net promoter score, Herfindahl index, things like year and quarter, et cetera. So we went through and we ran our regression. The regression results show that basically, our accuracy or our regression will let us pick up about 45.2% of the variation in sales. Not amazing, but you know, not bad as a starting point. So what I want to do from here is then turn around…

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