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From | David Hoaglin <dchoaglin@gmail.com> |
To | statalist@hsphsun2.harvard.edu |
Subject | Re: st: Transformation of variable with pos/neg values via asinh |
Date | Tue, 19 Nov 2013 07:24:52 -0500 |
Nick, In Steve's application the "balance" is (end of year) - (beginning of year). That produces the gain or loss. I would not ordinarily illustrate a balance as gain - loss. John Tukey's example (page 57, not involving data) is "profit-and-loss," which could arise from (end of year) - (beginning of year). He goes on to say, "Re-expression [transformation] of the balance rarely helps, but re-expression of the amounts or counts before the subtraction sometimes helps a lot." I will look for examples involving data. I would be reluctant to transform a balance by using the cube root, but I have not read your SJ article. From my "upbringing" in EDA I generally have a relaxed attitude about transformations, but I like them to be plausible. David Hoaglin On Tue, Nov 19, 2013 at 5:40 AM, Nick Cox <njcoxstata@gmail.com> wrote: > David's suggestion that with a balance, namely > > balance = gain - loss > > you are better off with > > transform of gain - transform of loss > > than with with > > transform of (gain - loss) > > echoes John Tukey's advice in Exploratory data analysis > (Addison-Wesley, Reading, MA, 1977). Tukey didn't give an example, and > I don't recall ever seeing one in his work. > > However, this is a counsel of perfection, as often the individual gain > and loss values are not accessible. > > Like Austin I've been advocating cube roots for some while. I often > work with audiences for whom asinh is beyond esoteric; I've even > encountered considerable resistance to cube roots. Some people seem > reluctant to try anything not sanctioned by a hundred texts. But they > got a puff in > > SJ-11-1 st0223 . . . . . . . . . . . . . . . . . . . Stata tip 96: Cube roots > . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N. J. Cox > Q1/11 SJ 11(1):149--154 (no commands) > tip showing the use of the cube function and cube roots > > No pretence: using cube roots is distinctly ad hoc (which, in modern > idiom, I translate freely as "fit for purpose"). So is asinh. > > > Nick > njcoxstata@gmail.com * * For searches and help try: * http://www.stata.com/help.cgi?search * http://www.stata.com/support/faqs/resources/statalist-faq/ * http://www.ats.ucla.edu/stat/stata/