covariance
UK[kəʊˈveə.ri.əns]US[koʊˈver.i.əns]
n
A measure of the relationship between two random variables, indicating the extent to which they change together.
n
In statistics, the mean value of the product of the deviations of two variates from their respective means.
Morpheme Breakdown
co
variance
co
together
variance
variation
Etymology
The term 'covariance' is a modern scientific compound, formed in English by combining the Latin-derived prefix 'co-' with the existing noun 'variance'. The prefix 'co-' (from Latin 'cum', meaning 'together') directly imports the concept of joint action or shared relationship. The core element 'variance' originates from Latin 'variare' (to change, to make different), which itself traces back to the Proto-Indo-European root wer- (to turn, to bend). The logical construction of the word is beautifully transparent: it literally denotes a "together-change" or a "joint variation," which perfectly captures its statistical function of quantifying how two variables deviate from their expected values in tandem, rather than in isolation.
Analysis
Structure: co (together) + variance (variation)
- co: A prefix of Latin origin, from 'com-' meaning 'together, with'.
- variance: A noun of Latin origin, from 'variantia' meaning 'difference, change', derived from 'variare' (to change). In this compound, it functions as the core noun denoting a measure of variation.
Examples
The covariance between stock prices and interest rates was calculated to be negative.
A positive covariance suggests that the variables tend to increase or decrease together.
The portfolio's risk was assessed by analyzing the covariance matrix of its asset returns.