[Verse 1]
Stock prices climbing through the years like stairs
Each month revealing patterns hiding there
Plot the dots upon your graph, connect them straight
Linear trends emerge when time meets fate
Independent variable ticks forward slow
While dependent prices ebb and flow
[Chorus]
Time on X and price on Y
Regression lines that pierce the sky
Slope reveals the yearly climb
R-squared measures how they rhyme
Time-series tells the market's tale
When patterns match, predictions sail
[Verse 2]
Residuals scatter when the line's not tight
Autocorrelation makes them correlate by sight
Yesterday's error links to tomorrow's mess
Durbin-Watson tests this time-bound stress
Spurious relationships can fool your eyes
When trending variables create false ties
[Chorus]
Time on X and price on Y
Regression lines that pierce the sky
Slope reveals the yearly climb
R-squared measures how they rhyme
Time-series tells the market's tale
When patterns match, predictions sail
[Bridge]
Stationarity means the mean stays flat
No explosive growth that breaks the stat
Differencing transforms the wandering trend
First differences help the chaos end
Cointegration finds the hidden thread
Between two series moving in lockstep
[Verse 3]
Seasonal patterns cycle through the year
Quarter effects make certain months appear
Dummy variables catch these rhythmic swings
While moving averages smooth the jagged things
Out-of-sample testing proves your model's worth
Before you bet your fortune on this earth
[Chorus]
Time on X and price on Y
Regression lines that pierce the sky
Slope reveals the yearly climb
R-squared measures how they rhyme
Time-series tells the market's tale
When patterns match, predictions sail
[Outro]
From scatter plots to forecast confidence bands
Time-series regression helps you understand
The past predicts but never guarantees
Tomorrow's prices dancing in the breeze