Pearson R Test Formula. The output shows pearson s correlation coefficient r 988 the two tailed statistical significance 000 spss does not show values below 001. Therefore the pearson correlation coefficient between the two stocks is 0 9088.
The resulting formula is. The correlation coefficient formula finds out the relation between the variables. In actuality there is always a chance of error so you should report the value as p 001 if spss reports 000 and the number of pairs n 9.
First we will calculate the following values.
In excel there is a function available to calculate the pearson correlation coefficient. Therefore the pearson correlation coefficient between the two stocks is 0 9088. The pearson correlation coefficient is a very helpful statistical formula that measures the strength between variables and relationships. If you want to learn more about about the test including the test assumptions then check out my pearson correlation explained article.
