From the course: Algorithmic Trading and Stocks Essential Training

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Advanced algorithms

Advanced algorithms

From the course: Algorithmic Trading and Stocks Essential Training

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Advanced algorithms

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- [Instructor] We'd previously put together a set of data looking at light vehicle sales, as it relates to various other macroeconomic variables: gas prices, Moody's bond yields, jobless claims, et cetera. Then we'd gone through and run a regression based on that so that we understood the relationship between light vehicle sales and some of these other figures. Now it's time to try and make a prediction for what light vehicle sales might be in the future. Now, the math and formulas are a little bit tedious so I've put some together something basic for you to start with. What we've got here is a simple model that'll help us to forecast light vehicle sales. And the idea is that we can use the coefficients from our regression analysis to understand what light vehicle sales might be. The way to interpret these coefficients is as follows: A one unit increase in gas prices would lead to a negative 0.72 change in car sales. So what…

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