R2 , or the coefficient of determination, measures the proportion of the variation in the
dependent variable about its mean explained by the variation in the independent
variable(s). The R2 coefficient ranges between 0.0 and 1.0. Higher values indicate a greater explanatory
power from the set of independent variables.
Please note that a high R-squared does not automatically imply that all
other regression assumptions are satisfied.
In fact, when using time series data a high R-squared (95% or higher)
generally implies violations of other regression assumptions - such as the
absence of autocorrelation. The adjusted R-Squared
coefficient corrects for this tendency.
R - squared =
SSR / SST