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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
A junior investment analyst used a polynomial regression model of relatively high order in a research seminar on municipal bonds and obtained an R2 of .991 in the regression of net interest yield of bond (Y) on industrial diversity index of municipality (X) for seven bond issues. A classmate, unimpressed, said: "You over fitted. Your curve follows the random effects in the data"
a. Comment on the criticism.
b. Might R2a defined in (6.42) be more appropriate than R2 as a descriptive measure here ?
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