Applies to: @RISK, all releases

Correlation Tornado vs. Regression Tornado Graphs

 

1. Direction of the Relationship

• Both regression and correlation indicate whether increasing an input increases or decreases an output.

  • Positive → as input increases, output increases.

  • Negative → as input increases, output decreases.

2. Correlation Coefficient

• Measures the consistency of the relationship between input and output, not the size of the effect.

• Visualize a scatter plot:

  • Horizontal axis: input

  • Vertical axis: output

  • Each point: one iteration (input-output pair)

• How to interpret:

  • +1 → perfect positive correlation: every time input increases, output increases.

  • 0 → no correlation: input increases are just as likely to increase as decrease output.

  • -1 → perfect negative correlation: every time input increases, output decreases.

• Key takeaway:
  Correlation tells you how consistently the output moves in one direction when the input changes.

3. Regression Coefficient

• Measures the strength or size of the effect of an input on the output.

• Example:

  • Coefficient of 6 → output increases 6 units for a 1-unit increase in input.

  • Coefficient of –4 → output decreases 4 units for a 1-unit increase in input.

• Key takeaway:
  Regression tells you how much the output changes for a given change in input, but not the consistency of that change.

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4. Comparison

Feature	Correlation Coefficient	Regression Coefficient
Shows direction?	✅ Positive or negative	✅ Positive or negative
Shows size/strength?	❌ Only consistency	✅ Actual change in output per unit input
Perfect relationship	+1 / –1 = perfectly consistent	Any number → shows exact effect size

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5. Notes for @RISK Users

• Tornado graphs often show scaled regression coefficients, not the actual units.

• You can view actual regression coefficients in the worksheet.

• See @RISK Help: “Regression and Correlation”

 

Related Articles:

Interpreting Regression Coefficients in Tornado Graphs

Regression Coefficients in Your Worksheet

Which Sensitivity Measure to Use?