The AI Vanguard Newsletter #4
Danny Butvinik
Chief Data Scientist | 100K+ Followers | FinCrime | Writer | Author of AI Vanguard Newsletter
In this issue: future of LLMs, image segmentation, towards AGI, Bing chatbot, Ordinary Least Squares, growth zone, motivation, and expert advice.
Papers of the Week
Industry Insights
Weekly Concept Breakdown
Ordinary Least Squares (OLS) is a statistical method used to estimate the relationship between a dependent variable and one or more independent variables. OLS is a popular tool in econometrics, finance, and other fields that rely on regression analysis. This article will explore OLS, providing intuitive explanations and examples to help you understand its workings and applications.
The idea behind OLS is simple: we want to find the line that best fits a set of data points. For example, if we have data on the age and height of a group of people, we might want to find the line that best predicts someone's height based on their age. The line that best fits the data is the one that minimizes the sum of the squared distances between the data points and the line. This line is called the regression line, and OLS is the method used to find it.
To understand OLS, it is helpful to start with a simple example. Suppose we have data on the price of a house and its size in square feet. We want to find the line that best predicts the price of a house based on its size. We start by plotting the data points on a scatter plot, with size on the x-axis and the price on the y-axis. The scatter plot shows that there is a positive relationship between the size of a house and its price. In other words, larger houses tend to be more expensive.
To find the regression line using OLS, we first need to estimate the slope and intercept of the line. The slope is the dependent variable (price) change for a one-unit change in the independent variable (size). The intercept is the point where the line crosses the y-axis. The OLS method finds the values of the slope and intercepts that minimize the sum of the squared distances between the data points and the line.
Once we have estimated the slope and intercept, we can use them to predict the price of a house of a given size. For example, if we estimate that the slope is $100 and the intercept is $50,000, we can predict that a house of 2000 square feet would cost $250,000 ($100 * 2000 + $50,000).
?Total Least Squares (TLS) is a variant of Ordinary Least Squares (OLS) used when there is uncertainty in the dependent and independent variables. OLS focuses on minimizing the sum of the squared distances between the data points and the regression line. However, in TLS, the focus is on minimizing the sum of the squared perpendicular distances between the data points and the regression line.
The key difference between OLS and TLS is that TLS considers the errors in the dependent and independent variables, while OLS only considers errors in the dependent variable. This makes TLS more robust to outliers and measurement errors in both variables. TLS can be especially helpful when both the dependent and independent variables have a lot of measurement errors, like in image processing or computer vision applications.
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One of the advantages of OLS is that it measures the goodness of fit of the regression line. The R-squared measure tells us that the independent variable explains a proportion of the variance in the dependent variable. A high R-squared indicates a good fit between the data and the regression line.
OLS is widely used in many fields, including economics, finance, and the social sciences. It is a versatile tool that can be applied to a wide range of problems, from predicting the price of a house to estimating the impact of a policy intervention. However, it is important to remember that OLS has some limitations. For example, it assumes that the relationship between the dependent and independent variables is linear, which may not always be true.
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Growth Zone
Finding work that makes us excited is important if we want to be truly happy in our careers. When we are engrossed in work that we enjoy, it no longer feels like a chore; we approach it with excitement and motivation, putting in the extra effort to achieve our goals. It is an opportunity to use our skills and creativity to their full potential. On the other hand, work that fails to pique our interest can leave us feeling stuck in a rut, lacking direction and purpose. It can be challenging to summon the energy and drive required to excel at such work.
To build a meaningful career, finding work that fits our values, interests, and goals is important. We are motivated to succeed in our careers and contribute to a larger vision when we have a clear sense of purpose. We are more likely to seek opportunities for growth and advancement and feel more confident and fulfilled professionally. By reflecting on our passions and making career choices that align with them, we can ensure that our work is personally and professionally rewarding.
One of the biggest problems data scientists face today is being able to explain their findings to people who aren't experts in their field. As a Chief Data Scientist, I advise my team to develop strong communication skills, including the ability to distill complex concepts into clear and concise language that others can easily understand. This includes developing visualizations and presentations that effectively convey the insights gleaned from data analysis. Also, it's important to know the needs and goals of stakeholders so that you can tailor your communication approach and give them insights they can use.
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Certified Qlik (Luminary2024) ,Tableau & Snowflake|GCP Consultant- Data Strategist| Storyteller|Investor
1 年Thanks for sharing the latest AI Vanguard edition Butvinik!
Data Scientist, Managing member, Aretisoft, LLC
1 年Thank you for the excellent selection of articles and insights!
Sales Associate at American Airlines
1 年Thanks for sharing