The coefficient of determination is used in statistical analysis to assess how well a model explains and predicts future outcomes. It's more commonly known as r-squared.

Correlation is a statistical measure of how two securities move in relation to each other. Investors use correlation to diversify their portfolios and hedge against risk.

Stuart R. Lipsitz, Traci Leong, Joseph Ibrahim, Steven Lipshultz, A Partial Correlation Coefficient and Coefficient of Determination for Multivariate Normal Repeated Measures Data, Journal of the ...

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The article How to Calculate Beta From Volatility and Correlation originally appeared on Fool.com. Try any of our Foolish newsletter services free for 30 days.