DEFINITION of 'Analysis Of Variances  ANOVA'
An analysis of the variation between all of the variables used in an experiment. Analysis of variance is used in finance in several different ways, such as to forecasting the movements of security prices by first determining which factors influence stock fluctuations. This analysis can provide valuable insight into the behavior of a security or market index under various conditions.
BREAKING DOWN 'Analysis Of Variances  ANOVA'
This type of analysis attempts to break down the various underlying factors that determine the price of securities as well as market behavior. For example, it could possibly show how much of a security's rise or fall is due to changes in interest rates. A ttest and ftest is used to analyze the results of an analysis of variance test to determine which variables are of statistical significance.

Analysis Of Variance  ANOVA
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Investing
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Investing
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Economics
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Is variance good or bad for stock investors?
Learn how high variance stocks are good for some investors and how diversified portfolios can reduce variance without compromising ... Read Answer >> 
What is price variance in cost accounting?
Understand what price variance is in relation to cost accounting. Learn the most common way price variance arises and how ... Read Answer >> 
How much variance should an investor have in an indexed fund?
Learn more about the significance of variance in index funds, its value as a measure of volatility and other common analytical ... Read Answer >> 
What is the difference between standard deviation and variance?
Understand the difference between standard deviation and variance; learn how each is calculated and how these concepts are ... Read Answer >> 
How can I measure portfolio variance?
Find out more about portfolio variance, the formula to calculate portfolio variance and how to calculate the variance of ... Read Answer >> 
How is an unfavorable variance discovered?
Learn how unfavorable variance is discovered through defining budget numbers, such as standard rates for labor and materials, ... Read Answer >>