{"id":71545,"date":"2019-05-31T04:59:29","date_gmt":"2019-05-31T11:59:29","guid":{"rendered":"https:\/\/www.questionpro.com\/blog\/?p=71545"},"modified":"2024-10-09T15:35:44","modified_gmt":"2024-10-09T22:35:44","slug":"correlation-analysis","status":"publish","type":"post","link":"https:\/\/www.questionpro.com\/blog\/correlation-analysis\/","title":{"rendered":"Data is the new oil; here\u2019s how you can drill it using correlation analysis"},"content":{"rendered":"
\n

Content Index<\/p>\n

    \n
  1. Correlation analysis \u2013 definition<\/a><\/li>\n
  2. How to use correlation analysis?\u00a0<\/a><\/li>\n
  3. Correlation analysis to drill down and drill through data<\/a><\/li>\n<\/ol>\n<\/div>\n

    Correlation analysis \u2013 definition<\/strong><\/a><\/h2>\n

    Definition:<\/strong> Correlation analysis<\/a> is defined as a statistical approach used to determine the relationship between the quantitative variables or categorical variables. With the help of correlation analysis, we can prove the relationship between two continuous variables; in short, it is a study conducted to understand how two variables are correlated.<\/p>\n

    Example:<\/strong> two variables like your body weight and daily calorie intake have a higher correlation. On the contrary, dog names and the brand of dog biscuits preferred by dogs will have a very low correlation.<\/p>\n

    Is data the new oil?<\/strong><\/h3>\n

    Once upon a time, the oil used to rule the global economy. It was an immensely precious asset of the 18th century. Without oil, economies used to shrink, governments used to tumble, and progress used to halt. Welcome to the future – a particular innovative wonder is fantastic the world; the advent of technology and the flow of data marked the beginning of the new global dominator. Around a decade ago, we heard what Clive Humby said – \u201cData is the new oil.\u201d<\/p>\n

    According to Clive, data is a commodity, and if treated just like oil, data is also a resource of no value if it remains unrefined. Similar to oil, data also needs a proper drilling technique so that value can be retrieved from it. Remember, correlation analysis is a data drilling technique, and in no way, you can use it for drilling oil.<\/p>\n

    Create a Free Account<\/strong><\/a><\/p>\n

    Correlation analysis – Innovative approach to drill data<\/strong><\/h3>\n

    When you want to determine correlation through data analysis, there are two types of data you need to work with<\/p>\n

    Univariate Data: <\/strong>When you want to work with a single variable, you need to measure the central tendency for inquiring about the representative data. Additionally, understand the deviation around the central tendency via dispersion. Measure the shape and size of the distribution through skewness. Apart from that, measure the concentration of data at the central position through kurtosis. Thus, data relating to a single variable is called Univariate data.<\/p>\n

    Bivariate Data:<\/strong> Correlation analysis is more about studying the relationship between two variables at the same time. Example, the price of a product versus average sales of the product or age versus blood pressure of a person. Thus, two characters of the same entity, when measured simultaneously with the help of statistical analysis<\/a> then we term it as a bivariate data. In statistical analysis, distinguishing between categorical data and numerical data<\/a> is essential, as categorical data involves distinct categories or labels, while numerical data consists of measurable quantities.<\/p>\n

    If there is any correlation between two variables, then whenever there is a systemic change is one variable, the other variable also changes. Thus, the variables alter together over a while. The correlation, therefore, found can be either positive or negative, depending on the measured numerical values.<\/p>\n