In Part 3 of our series on modern portfolio theory, we discuss how R-squared can determine the usefulness of other MPT statistics. In a recent article, we went over how beta and other modern portfolio ...

R-squared values range from 0 to 1, indicating the fit and explanatory power of a regression model. Values below 0.3 suggest weak explanatory power; above 0.7 indicate strong relationships. In finance ...

R-squared – or the coefficient of determination – is a statistical measure that represents the percentage of a fund or security's movements that can be explained by movements in a benchmark index.

When people invest in mutual funds, they usually look at returns, ratings and past performance. But there is one number that quietly explains how predictable a fund’s behaviour is — the R-squared ...