^ cp he is right, R^2 for multiple regression is not calculated the same as simple linear regression
i think the conclusion is most of us have gaps to fill in the topic,
here is an interesting article
i leave it here, we all can read it after exam, comparing r a r ^2, for now i guess we have enough explanation to get by on level III, thanks all
The correlation measures the amount of interaction between two variables, so you’d want to use this when figuring out diversification benefits, co-movements, etc. In most problems, they’re just making the assumption that the r-squared is relatively high. Don’t overthink this…
Yes, it depends on how you define the R^2. It can be negtive for non-linear trend data.
* search for: “Coefficient of determination”
One thing I’m confused about: if Correl (1,2) = Cov(1,2) / (Stdev1*Stdev2), then how does that fit with the reading on international diversification that says higher vol (ie stdev) causes the correlation to increase (v3, p369)? Shouldn’t it decrease based on the formula, or can you not think about that concept in mathematical terms?
mathematically, your formula do not mention about currency effect…
ie: corr (,@) = cov (, /@)/std ()* std ($/@)
…
when volatility increase, currency exchange also fluctuate…
I think the concept is not mathematical term
i am not sure 
Let’s say we’re talking about two Euro countries/markets, so the currency effect does not matter…?