what is autocorrelation 
autocorrelation is a mathematical representation of the degree of similarity between a given time series and a lagged version of itself over successive time intervals it s conceptually similar to the correlation between two different time series but autocorrelation uses the same time series twice once in its original form and once lagged one or more time periods for example if it s rainy today the data suggests that it s more likely to rain tomorrow than if it s clear today when it comes to investing a stock might have a strong positive autocorrelation of returns suggesting that if it s up today it s more likely to be up tomorrow too naturally autocorrelation can be a useful tool for traders to utilize particularly for technical analysts investopedia jiaqi zhouunderstanding autocorrelationautocorrelation can also be referred to as lagged correlation or serial correlation as it measures the relationship between a variable s current value and its past values as a very simple example take a look at the five percentage values in the chart below we are comparing them to the column on the right which contains the same set of values just moved up one row 