How could I explain the hypothesis not being rejected where the coefficients is all equal to zero?Im thinking : the data tells us to we can not reject the hypothesis at the intercept, but since the value of the variables equaling zero is unreasonable in reality, the t and p value are not very interesting at the interceptNew comments cannot be posted and votes cannot be castA central repository for questions about economic theory, research, and policy. About this kind of model particularly, what's the meaning of the intercept?
The point at which a line meets the vertical axis of a graph.
But given that the intercept usually has no useful interpretation anyways, its significance is usually irrelevant.Thanks for your response mate Well if I reject the hypothesis that sex has no impact on earnings ( since the values tell me to reject the hypothesis. 1&=cov(m,R)+\mathbb{E}(m)\mathbb{E}(R)\\\\ Meaning and definition of vertical intercept . This implies many factor models in the form of linear regression Thanks for contributing an answer to Quantitative Finance Stack Exchange! Detailed answers to any questions you might have
Does it have to be necessarily significant and equal to zero in order that the model can model properly the asset prices?I looked some answers for the internet, but I found only contradictory opinions. If height is zero, the regression equation predicts that weight is -114.3 kilograms! In economics, it acts as a shorthand indication of the effect one economic …
\end{align}$R_i-R_f=\alpha_i + \sum\beta_{ij}f_{j} + \varepsilon_i$ Please read the rules before posting.Press J to jump to the feed. How could I explain the hypothesis not being rejected where the coefficients is all equal to zero?Im thinking : the data tells us to we can not reject the hypothesis at the intercept, but since the value of the variables equaling zero is unreasonable in reality, the t and p value are not very interesting at the interceptA question is ”interpret the p value at the intercept”, and the p-value is 0.666So the t stat allows you to test whether the mean for the sex=0 category with earnings =0 is significantly different from 0Thanks for your response mate Well if I reject the hypothesis that sex has no impact on earnings ( since the values tell me to reject the hypothesis. Specifically, the existence of stochastic discounting factor leads to Quantitative Finance Stack Exchange works best with JavaScript enabled
I know that, technically speaking, from an econometric point of view, it should be the value assumed by the dependent variable on average, given the independent variables of the model set to be equal to 0. I knew the first case, in which one analyzes the asset returns, but not the latter. Stack Exchange network consists of 177 Q&A communities including
For the term vertical intercept may also exist other definitions and meanings, the meaning and definition indicated above are indicative not be used for medical and legal or special purposes. Interpreting the Intercept.