dependence

Covariance (Distribution Theory) (GWU EMSE-271)
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Positive dependence indicates X & Y values change in the same direction. Negarive dependence indicates when one increases, the other decreases.

"When large values of X tend to be associated with large values of Y and vice versa, X and Y are said to be **positively dependent** and it follows that COV (X,Y) > 0. Thus the variables X and Y "reinforce" each other in their sum X+Y and the variance of X+Y is larger than the sum of their individual variances. "When large values of Xtend to be associated with small values of Y and vice versa, Xand Y are said to be **negatively dependent** and it follows that COV (X,Y) <0 Thus the variables X and Y "cancel" each other in their sum X+Y and the variance of X+Y is smaller than the sum of their individual variances." – EMSE 271,Fall 2009, Slide 44
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 * Sources:**
 * EMSE 271, Fall 2009