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Thread: Regression on two explicative variables

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    Regression on two explicative variables




    Hello,

    I am currently doing a thesis which aims to explain returns of stocks in function of the ownerships of some stakeholders.

    In the Excel attached, I would like to explain the returns in the last column with the two explicative variables ( Venture Capital % Ownership and Hedge Funds % Ownerships).
    The aim is to find results stated such as this : When the % of venture capital in the company is high, we find that stocks returns are high.
    This is the kind of correlation I would like to find but I do not know how to realize these regressions and interpret it as I am not an expert in statistics.

    Do you know how I should do this please? I am also looking for a practical book/paper/guide, to practically do this kind of regression and interpret the results.

    Thank you in advance for your response !

    Gautier
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    Re: Regression on two explicative variables

    Does explicative = explanatory in your context?
    Stop cowardice, ban guns!

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    Re: Regression on two explicative variables


    Yes indeed ! This is my "regressors"

    I am currently trying to do the regression in the software R. But I encounter some difficulties and I am not sure if my code is correct! Can you please check that if you have knowledge in R ?

    By the way, R sends me the error : "Error in fund - rf : non-numeric argument to binary operator". So I am blocked for the moment ..

    Here is my code (I use Fama french names because I used it to make a regression before, and a friend told me it is the same except that you have to put your data for each company in lines, which I did, I sent you a screenshot of my Excel that I transfered in CSV file, to show you how my table looks like).

    Fama-French Regression example in R

    Load CSV file into R

    ff_data <- read.table("Book10.csv",header=TRUE,sep=",")

    Extract Fama-French Factors and Fund Returns

    VentureCapital <- ff_data[,2]/100 HedgeFund <- ff_data[,3]/100

    for (i in 4) { fund <- ff_data[,i]/100 fund.xcess <- fund - rf ffregression <- lm(fund.xcess ~ VentureCapital + HedgeFund) print(summary(ffregression)) }



    Thank a lot for your answer
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