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Medium · statistical_analysis · Quant Researcher interview question · structural-break, chow-test, ols, regression, scipy
The Chow test is a statistical method for detecting a structural break in a regression model at a known point in time. Quantitative researchers use it to verify if a specific event, such as a central bank announcement or market crisis, has fundamentally changed the relationship between financial variables. The test compares the fit of a single regression on the entire dataset against the combined fit of separate regressions on the sub-periods before and after the suspected break. Task Implement