# What is Cholesky decomposition

Learn things especially in coding need a practice. Lets put it into work then. Today we are going to enthusiatly dig deeper between what is VAR and what is structural VAR.

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PhD is when you are trying to explain something and get so enthusiatly love about it.

When we discuss a lot about SVAR, there is so many words mentioning Cholesky decomposition, what is it? And why it is important to know about Cholesky decomposition, so let's say it's actually a way to find the other format of the triangle in upper and lower.

Lets say

$$A = L . L^{T}$$

Or Matrix x equal with decomposition L multiply by L transpose.

The picture is here

Play with Cholesky in Matlab

After I learned about Cholesky decomposition, I feel like I got some superpower.

Five simple step of CHolesky decomposition

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#### First post in 2023

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All the best!
Thank you 2022, I thank you for all the good and bad memories of 2022. All of them has made me wiser and more mature. And I welcome the 2023! With all the best in everything!

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# Analysis of correlation and significance of parameters

## Correlation

The study of the significance of the impact of input parameters on output parameters should begin with the analysis of the correlation of individual parameters. Three basic dependencies can be checked:

#### How to calculate the correlation using their original formula

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Correlation coefficients are used to measure how strong a relationship is between two variables. There are several types of correlation coefficient, but the most popular is Pearson’s. Pearson’s correlation (also called Pearson’s R) is a correlation coefficient commonly used in linear regression. If you’re starting out in statistics, you’ll probably learn about Pearson’s R first. In fact, when anyone refers to the correlation coefficient, they are usually talking about Pearson’s.

#### VARs package in R

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Need to check it out

#### VAR in stata

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This one is interesting

#### SVAR model example

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SVAR model example can be found in literature of macroeconomic.

#### VAR vs SVAR risk

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This topic also need to look back at

#### SVAR model in R

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Its interesting topic that I havent dig deeper

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