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Kenneth Frendo and I have been writing to each other for a while now and the other day, Kenneth wrote with a request that I was able to help a little bit with.

From: Kenneth J. Frendo
Sent: Saturday, March 23, 2002
Subject: Financial Modelling

Dear Professor Williamson,

As you may recall, some time ago I was in touch through e-mail regarding you valuable and interesting site. Indeed, since at present I am studying for an MSc in Finance, I must admit that I am finding your information extremely helpful in my studies.

At present I am studying the module on "Financial Modelling" which in essence concerns "Descriptive Statistics", "Regression Analysis" etc. Unfortunately, I'm finding the material quite difficult and as a result I was wondering whether you can help me here by suggesting any material/web-sites which could potentially help me understand better the hundreds of formulae related to this subject.

I understand that you may be extremely busy, however I would be extremely grateful if you could give me some advice.

Kind regards,
Kenneth Frendo,
Malta

Always ready to help where I can, I dug out the following links and pieces of advice.

Dear Kenneth,

Good to hear from you again.

A good starting place is Excel’s help files. Take a look in the Help section for anything you are doing at the moment. For example, here’s a list of books that might help, from Excel’s help section: maybe your library has them and maybe they’ll help.

The following book provides detailed information about the algorithms used to create the Microsoft Excel analysis tools and functions.

Strum, Robert D., and Donald E. Kirk. First Principles of Discrete Systems and Digital Signal Processing. Reading, Mass.: Addison-Wesley Publishing Company, 1988.

The following books provide detailed information about statistical methods or algorithms used to create the Microsoft Excel statistical tools and functions.

Abramowitz, Milton, and Irene A. Stegun, eds. Handbook of Mathematical Functions, with Formulas, Graphs, and Mathematical Tables. Washington, D.C.: U.S. Government Printing Office, 1972.

Box, George E.P., William G. Hunter, and J. Stuart Hunter. Statistics for Experimenters: An Introduction to Design, Data Analysis, and Model Building. New York: John Wiley and Sons, 1978.

Devore, Jay L. Probability and Statistics for Engineering and the Sciences. 4th ed. Wadsworth Publishing, 1995.

McCall, Robert B. Fundamental Statistics for the Behavioral Sciences. 5th ed. New York: Harcourt Brace Jovanovich, 1990.

Press, William H., Saul A. Teukolsky, William T. Vetterling, and Brian P. Flannery. Numerical Recipes in C: The Art of Scientific Computing. 2nd ed. New York: Cambridge University Press, 1992.

Sokal, Robert R., and F. James Rohlf. Biometry: The Principles and Practice of Statistics in Biological Research. 2nd ed. New York: W. H. Freeman, 1995.

Then do a search on INTERCEPT, STEYX, FORECAST … and see what you find.

Don’t forget http://www.duncanwil.co.uk/average1.html if it’s means and medians etc you’re after

http://www.mste.uiuc.edu/hill/dstat/dstat.html covers the very basics

http://www.cas.lancs.ac.uk/glossary_v1.1/car.html is a glossary of some terms

http://thesaurus.maths.org/dictionary/map/indices/A is a monster glossary with examples and formulae. Change the A at the end to B to C to whichever letter you’re interested in.

http://www.geography-site.co.uk/index.html is the home page and this page covers the Chi squared test ... webmaster David Robinson kindly wrote to me and updated that link for me today, 8th March 2006.

http://elsa.berkeley.edu/sst/regression.html for regression

http://www.statsoftinc.com/textbook/stmulreg.html#cpredicted for multiple regression

http://mathforum.org/ for Dr Math: that has a huge database of great ideas … it takes effort to find what you want but it could be fruitful.

http://www.ats.ucla.edu/stat/books/ara/default.htm might be of use.

Hope this is of some use Kenneth.

Duncan

Kenneth response was:

Sent: Sunday, March 24, 2002
Subject: Re: Financial Modelling

I cannot find the appropriate words to express my deep gratitude for all your help and support. In fact, I will limit myself to just "a simple thankyou!"

Evidently, the information included in your e-mail is very valuable and I will certainly use it thouroughly in my studies.

Thanks again and rest assured that I'll keep in touch.

Kind regards,
Kenneth

Happy to help.

Duncan Williamson
6 April 2002 updated 8th March 2006