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1. Its the likelihood of a domino effect occurring within a tranche of a CDO. If all the companies in a CDO are in the automobile industry, and one begins to fail and therefore is unable pay its debts, there is a good chance that it might be something in the automobile industry that is causing these companies to falter. Therefore if on company fails, the probability of others failing increases.
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What is a sample correlation?
If measurements are taken for two (or more) variable for a sample , then the correlation between the variables are the sample correlation. If the sample is representative then the sample correlation will be a good estimate of the true population correlation.
What is a Correlation coefficient of 0.00457?
Evidence that there is no correlation.
What are the trends of a line?
They can be positive correlation, negative correlation or no correlation depending on 'line of best fit'
Is -0.0001 a correlation coefficient?
Yes it can be a correlation coefficient.
Is 1.5 a correlation coefficient?
No, it cannot be a correlation coefficient.
