# correlation

Definition
Related Terms
Degree and type of relationship between any two or more quantities (variables) in which they vary together over a period; for example, variation in the level of expenditure or savings with variation in the level of income. A positive correlation exists where the high values of one variable are associated with the high values of the other variable(s). A 'negative correlation' means association of high values of one with the low values of the other(s). Correlation can vary from +1 to -1. Values close to +1 indicate a high-degree of positive correlation, and values close to -1 indicate a high degree of negative correlation.
Values close to zero indicate poor correlation of either kind, and 0 indicates no correlation at all. While correlation is useful in discovering possible connections between variables, it does not prove or disprove any cause-and-effect (causal) relationships between them. See also regression.

## Use 'correlation' in a Sentence

The study suggested that a strong correlation existed between a high willingness to undertake risks and strong performance in the stock market.
It is possible for there to be spurious correlations between two things such as the amount of cheese consumed in Wisconsin and the number of deaths in Iowa, however one must be able to differentiate between real correlations and spurious ones.
There was seemingly no correlation between him doing a rain dance and it actually raining, and yet he was out there doing it anyway.

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