DEFINITION of 'Regression'
A statistical measure that attempts to determine the strength of the relationship between one dependent variable (usually denoted by Y) and a series of other changing variables (known as independent variables).
BREAKING DOWN 'Regression'
The two basic types of regression are linear regression and multiple regression. Linear regression uses one independent variable to explain and/or predict the outcome of Y, while multiple regression uses two or more independent variables to predict the outcome. The general form of each type of regression is:
Linear Regression: Y = a + bX + u
Multiple Regression: Y = a + b_{1}X_{1 +} b_{2}X_{2} + B_{3}X_{3} + ... + B_{t}X_{t} + u
Where:
Y= the variable that we are trying to predict
X= the variable that we are using to predict Y
a= the intercept
b= the slope
u= the regression residual.
In multiple regression the separate variables are differentiated by using subscripted numbers.
Regression takes a group of random variables, thought to be predicting Y, and tries to find a mathematical relationship between them. This relationship is typically in the form of a straight line (linear regression) that best approximates all the individual data points. Regression is often used to determine how much specific factors such as the price of a commodity, interest rates, particular industries or sectors influence the price movement of an asset.

Linear Relationship
A statistical term used to describe the directly proportional ... 
Kappa
One of the "Greeks," kappa is the ratio of the dollar price change ... 
Rescaled Range Analysis
A statistical analysis of a timeseries of financial data that ... 
Detrend
In forecasting models, the process of removing the effects of ... 
Portable Alpha
A strategy in which portfolio managers separate alpha from beta ... 
Beta
Beta is a measure of the volatility, or systematic risk, of a ...

Investing Basics
Calculating Beta: Portfolio Math For The Average Investor
Beta is a useful tool for calculating risk, but the formulas provided online aren't specific to you. Learn how to make your own. 
Economics
Understanding Regression
Regression is a statistical analysis that attempts to predict the effect of one or more variables on another variable. 
Personal Finance
Does Your Investment Manager Measure Up?
These key stats will reveal whether your advisor is a league leader or a benchwarmer. 
Investing Basics
Regression Basics For Business Analysis
This tool is easy to use and can provide valuable information on financial analysis and forecasting. Find out how. 
Investing Basics
Beta: Gauging Price Fluctuations
Learn how to properly use this measure that can help you meet your criteria for risk. 
Options & Futures
Adding Alpha Without Adding Risk
Learn how to generate higher returns in your portfolio while keeping the same risk profile. 
Trading Strategies
When Is A Bull Market Not A Bull Market?
During some bull or bear moves in the stock markets, investors will be going with the trend, but day traders may find they cannot. 
Active Trading
The Linear Regression Of Time and Price
This investment strategy can help investors be successful by identifying price trends while eliminating human bias. 
Investing
3 Healthy Financial Habits for 2016
”Winning” investors don't just set it and forget it. They consistently take steps to adapt their investment plan in the face of changing markets. 
Investing
How to Ballast a Portfolio with Bonds
If January and early February performance is any guide, there’s a new normal in financial markets today: Heightened volatility.

How can I use a regression to see the correlation between prices and interest rates?
In statistics, regression analysis is a widely used technique to uncover relationships among variables and determine whether ... Read Full Answer >> 
How can I run linear and multiple regressions in Excel?
The first step in running regression analysis in Excel is verifying that your software has the capabilities to perform the ... Read Full Answer >> 
How can I run linear regressions in MATLAB?
MATLAB is a powerful computing environment and programming language that is commonly used in statistics and finance. To run ... Read Full Answer >> 
Does a negative correlation between two stocks mean anything?
Negative correlation with regard to stocks means two individual stocks have a statistical relationship such that they generally ... Read Full Answer >> 
How do you calculate beta in Excel?
Many investors use the risk measurement beta, or ?, when evaluating a given equity. Beta looks at the historical performance ... Read Full Answer >> 
What is finance?
"Finance" is a broad term that describes two related activities: the study of how money is managed and the actual process ... Read Full Answer >>