Regression analysis vs ratio Analysis

CFA Level I FRA
#1

Ratio analysis - According to me, it includes computation of relationships between different variables of the balance sheet/income stattement. May be the variables are not used directly, such as total assets (is a composition of different balance sheet variables - such as cash + investments + fixed assets + etc.). Sales / total assets is some ratio.

Now regression analysis is comparision of / assessment of relationships between different variables such as sales & GDP. How sales move with the movement in GDP, etc… In a way, we are simply calculating the ratio.

What is the difference between ratio analysis and regerssion analysis?

#2

Regression attempts to draw a casual relationship of the data. Linear regressions draws a best fit line, with, or without a zero intercept by minimzing the sum of squared residuals. It includes many techniques for modeling and analyzing several variables, when the focus is on the relationship between a dependent variable and one or more independent variables. Rato analysis can be a tool for other than pure statistics, like fundamental analysis. Both have their uses.