Sample variance formula in Excel
- Find the mean by using the AVERAGE function: =AVERAGE(B2:B7)
- Subtract the average from each number in the sample:
- Square each difference and put the results to column D, beginning in D2:
- Add up the squared differences and divide the result by the number of items in the sample minus 1:
Contents
- 1 What is the formula for sample variance in Excel?
- 2 How do you find the sample variance?
- 3 How do you find the variance on a spreadsheet?
- 4 What is the difference between var s and var p in Excel?
- 5 How do you find sample variance and standard deviation?
- 6 How do you find the sample standard deviation in Excel?
- 7 How do you find the coefficient of variation on Excel?
- 8 How do you find the variance between two numbers?
- 9 Is variance the same as standard deviation?
- 10 What does 95% VAR mean?
- 11 What is VAR s formula in Excel?
- 12 What does VAR mean in Excel?
- 13 How do you calculate variance in accounting?
- 14 How do you find the variance of ungrouped data?
- 15 How do you find sample variance in R?
- 16 How do you compute for the variance and standard deviation of the sampling distribution of sample means?
- 17 What is the symbol for the sample variance?
- 18 How do you find the standard deviation of a sample?
- 19 Is there a standard deviation IF function in Excel?
- 20 How do you find the variance and coefficient of variation?
What is the formula for sample variance in Excel?
If you’re using Excel 2007 or earlier, or you want your file to be compatible with these versions, the formulas are: “=VARP(A1:A20),” if your data is the entire population, or “=VAR(A1:A20),” if your data is a sample from a larger population. The variance for your data will be displayed in the cell.
How do you find the sample variance?
The steps to find the sample variance are as follows:
- Find the mean of the data.
- Subtract the mean from each data point.
- Take the summation of the squares of values obtained in the previous step.
- Divide this value by n – 1.
How do you find the variance on a spreadsheet?
To calculate variance across an entire population, use VARP . VAR takes the sum of the squares of each value’s deviation from the mean and divides by the number of such values minus one.
What is the difference between var s and var p in Excel?
VAR. S calculates the variance assuming given data is a sample. VAR. P calculates the variance assuming that given data is a population.
How do you find sample variance and standard deviation?
To calculate the variance, you first subtract the mean from each number and then square the results to find the squared differences. You then find the average of those squared differences. The result is the variance. The standard deviation is a measure of how spread out the numbers in a distribution are.
How do you find the sample standard deviation in Excel?
Say there’s a dataset for a range of weights from a sample of a population. Using the numbers listed in column A, the formula will look like this when applied: =STDEV. S(A2:A10). In return, Excel will provide the standard deviation of the applied data, as well as the average.
How do you find the coefficient of variation on Excel?
You can calculate the coefficient of variation in Excel using the formulas for standard deviation and mean. For a given column of data (i.e. A1:A10), you could enter: “=stdev(A1:A10)/average(A1:A10)) then multiply by 100.
How do you find the variance between two numbers?
The variance percentage calculation is the difference between two numbers, divided by the first number, then multiplied by 100.
Is variance the same as standard deviation?
The variance is the average of the squared differences from the mean.Standard deviation is the square root of the variance so that the standard deviation would be about 3.03. Because of this squaring, the variance is no longer in the same unit of measurement as the original data.
What does 95% VAR mean?
It is defined as the maximum dollar amount expected to be lost over a given time horizon, at a pre-defined confidence level. For example, if the 95% one-month VAR is $1 million, there is 95% confidence that over the next month the portfolio will not lose more than $1 million.
What is VAR s formula in Excel?
The VAR. S function is categorized under Excel Statistical functions.This function will return the variance of a sample. It was introduced in Excel’s 2010 version. As we know, variance is a statistical measure used across a set of values to identify the amount that the values vary from the average value.
What does VAR mean in Excel?
The Excel VAR function estimates the variance of a sample of data. If data represents the entire population, use the VARP function or the newer VAR. P function. VAR ignores text values and logicals in references.
How do you calculate variance in accounting?
Variance = Forecast – Actual
To find your variance in accounting, subtract what you actually spent or used (cost, materials, etc.) from your forecasted amount. If the number is positive, you have a favorable variance (yay!).
How do you find the variance of ungrouped data?
In probability theory and statistics, the variance formula measures how far a set of numbers are spread out.
Summary:
| Variance Type | For Ungrouped Data | For Grouped Data |
|---|---|---|
| Population Variance Formula | σ2 = ∑ (x − x̅)2 / n | σ2 = ∑ f (m − x̅)2 / n |
| Sample Variance Formula | s2 = ∑ (x − x̅)2 / n − 1 | s2 = ∑ f (m − x̅)2 / n − 1 |
How do you find sample variance in R?
In R, sample variance is calculated with the var() function. In those rare cases where you need a population variance, use the population mean to calculate the sample variance and multiply the result by (n-1)/n; note that as sample size gets very large, sample variance converges on the population variance.
How do you compute for the variance and standard deviation of the sampling distribution of sample means?
For N numbers, the variance would be Nσ2. Since the mean is 1/N times the sum, the variance of the sampling distribution of the mean would be 1/N2 times the variance of the sum, which equals σ2/N. The standard error of the mean is the standard deviation of the sampling distribution of the mean.
What is the symbol for the sample variance?
The symbol ‘s2‘ represents the sample variance.
How do you find the standard deviation of a sample?
Here’s how to calculate sample standard deviation:
- Step 1: Calculate the mean of the data—this is xˉx, with, bar, on top in the formula.
- Step 2: Subtract the mean from each data point.
- Step 3: Square each deviation to make it positive.
- Step 4: Add the squared deviations together.
Is there a standard deviation IF function in Excel?
The Excel DSTDEV function gets the standard deviation of sample data extracted from records matching criteria. Essentially, this function calculates standard deviation on a subset of data, like a “standard deviation IF” formula.
How do you find the variance and coefficient of variation?
To describe the variation, standard deviation, variance and coefficient of variation can be used. The coefficient of variation is the standard deviation divided by the mean and is calculated as follows: In this case µ is the indication for the mean and the coefficient of variation is: 32.5/42 = 0.77.
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Estimates variance based on a sample.
Important: This function has been replaced with one or more new functions that may provide improved accuracy and whose names better reflect their usage. Although this function is still available for backward compatibility, you should consider using the new functions from now on, because this function may not be available in future versions of Excel.
For more information about the new function, see VAR.S function.
Syntax
VAR(number1,[number2],…)
The VAR function syntax has the following arguments:
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Number1 Required. The first number argument corresponding to a sample of a population.
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Number2, … Optional. Number arguments 2 to 255 corresponding to a sample of a population.
Remarks
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VAR assumes that its arguments are a sample of the population. If your data represents the entire population, then compute the variance by using VARP.
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Arguments can either be numbers or names, arrays, or references that contain numbers.
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Logical values, and text representations of numbers that you type directly into the list of arguments are counted.
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If an argument is an array or reference, only numbers in that array or reference are counted. Empty cells, logical values, text, or error values in the array or reference are ignored.
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Arguments that are error values or text that cannot be translated into numbers cause errors.
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If you want to include logical values and text representations of numbers in a reference as part of the calculation, use the VARA function.
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VAR uses the following formula:
where x is the sample mean AVERAGE(number1,number2,…) and n is the sample size.
Example
Copy the example data in the following table, and paste it in cell A1 of a new Excel worksheet. For formulas to show results, select them, press F2, and then press Enter. If you need to, you can adjust the column widths to see all the data.
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Strength |
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1345 |
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1301 |
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1368 |
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1322 |
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1310 |
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1370 |
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1318 |
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1350 |
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1303 |
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1299 |
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Formula |
Description |
Result |
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=VAR(A2:A11) |
Variance for the breaking strength of the tools tested. |
754.2667 |
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Find the spread of your data using variance and standard deviation
Updated on December 8, 2022
What to Know
- Use the VAR.P function. The syntax is: VAR.P(number1,[number2],…)
- To calculate standard deviation based on the entire population given as arguments, use the STDEV.P function.
This article explains data summarization and how to use deviation and variance formulas in Excel for Microsoft 365, Excel 2019, 2016, 2013, 2010, 2007, and Excel Online.
Summarizing Data: Central Tendency and Spread
The central tendency tells you where the middle of the data is, or the average value. Some standard measures of the central tendency include the mean, the median, and the mode.
The spread of data means how much individual results differ from the average. The most straightforward measure of spread is the range, but it’s not very useful because it tends to keep increasing as you sample more data. Variance and standard deviation are much better measures of spread. The variance is simply the standard deviation squared.
A sample of data is often summarized using two statistics: its average value and a measure of how spread out it is. Variance and standard deviation are both measures of how spread out it is. Several functions let you calculate variance in Excel. Below, we’ll explain how to decide which one to use and how to find variance in Excel.
Standard Deviation and Variance Formula
Both the standard deviation and the variance mesure how far, on average, each data point is from the mean.
If you were calculating them by hand, you would start by finding the mean for all your data. You would then find the difference between each observation and the mean, square all those differences, add them all together, then divide by the number of observation.
Doing so would give the variance, a kind of average for all the squared differences. Taking the variance’s square root corrects the fact that all the differences were squared, resulting in the standard deviation. You will use it to measure the spread of data. If this is confusing, don’t worry. Excel does the actual calculations.
Sample or Population?
Often your data will be a sample taken from some larger population. You want to use that sample to estimate the variance or standard deviation for the population as a whole. In this case, instead of dividing by the number of observation (n), you divide by n-1. These two different types of calculation have different functions in Excel:
- Functions with P: Gives the standard deviation for the actual values you have entered. They assume your data is the whole population (dividing by n).
- Functions with an S: Gives the standard deviation for a whole population, assuming your data is a sample taken from it (dividing by n-1). It can be confusing, as this formula provides the estimated variance for the population; the S indicates the dataset is a sample, but the result is for the population.
Using the Standard Deviation Formula in Excel
To calculate the standard deviation in Excel, follow these steps.
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Enter your data into Excel. Before you can use the statistics functions in Excel, you need to have all your data in an Excel range: a column, a row, or a group matrix of columns and rows. You need to be able to select all the data without selecting any other values.
For the rest of this example, the data is in the range A1:A20.
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If your data represents the entire population, enter the formula «=STDEV.P(A1:A20).» Alternatively, if your data is a sample from some larger population, enter the formula «=STDEV(A1:A20).»
If you’re using Excel 2007 or earlier, or you want your file to be compatible with these versions, the formulas are «=STDEVP(A1:A20),» if your data is the entire population; «=STDEV(A1:A20),» if your data is a sample from a larger population.
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The standard deviation will be displayed in the cell.
How to Calculate Variance in Excel
Calculating variance is very similar to calculating standard deviation.
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Ensure your data is in a single range of cells in Excel.
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If your data represents the entire population, enter the formula «=VAR.P(A1:A20).» Alternatively, if your data is a sample from some larger population, enter the formula «=VAR.S(A1:A20).»
If you’re using Excel 2007 or earlier, or you want your file to be compatible with these versions, the formulas are: «=VARP(A1:A20),» if your data is the entire population, or «=VAR(A1:A20),» if your data is a sample from a larger population.
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The variance for your data will be displayed in the cell.
FAQ
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How do I find the coefficient of variation in Excel?
There’s no built-in formula, but you can calculate the coefficient of variation in a data set by dividing the standard deviation by the mean.
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How do I use the STDEV function in Excel?
The STDEV and STDEV.S functions provide an estimate of a set of data’s standard deviation. The syntax for STDEV is =STDEV(number1, [number2],…). The syntax for STDEV.S is =STDEV.S(number1,[number2],…).
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Excel Variance (Table of Contents)
- Introduction to Variance in Excel
- How to Calculate Variance in Excel?
Introduction to Variance in Excel
Variance is used in cases if we have some budgets, and we may know the variances observed in implementing the budgets. In some cases, the term variance is also used to calculate the difference between the planned and the actual results. Variance calculation is a great way for data analysis as this let us know the spread through of variation in the data set.
Variance is nothing but just information that shows us how well the data is spread through. Calculating variance is required, especially in cases where we have been doing a sampling of data. This is important because we use the correct function to calculate the variance like VAR.S or VAR.P. We have a few cases to calculate variance in excel where we have some data that has been projected for the period, and we want to compare that with the actual figures.
How to Calculate Variance in Excel?
Let’s understand how to Calculate Variance in Excel with some examples.
You can download this Variance Excel Template here – Variance Excel Template
Example #1 – Calculating variance in excel for the entire population
If the data set is for the complete population, then we need to use the VAR.P function of excel. This is because, in excel, we have two functions that are designed for different datasets.
We may have data that is collected based on sampling, which might be the population of the entire world.
VAR.P uses the following formula:
Step 1 – Enter the data set in the columns.
Step 2 – Insert the VAR.P function and choose the range of the data set. Here one thing should be noted that if any cell has an error, then that cell will be ignored.
Step 3 – After pressing the Enter key, we will get the variance.
We have calculated the variance of Set B by following the same steps given above. The result of the variance of Set B is shown below.
Example #2 – Calculating the variance for sample size in excel
If we have data set that represents samples, then we need to use the function of VAR.S instead of using the VAR.P
This is because this function has been designed to calculate the variance, keeping in mind the sampling method’s characteristics.
VAR.S uses the following formula:
Step 1 – Enter the data set in the column.
Step 2 – Insert the VAR.S function and choose the range of the data set.
Step 3 – We will get the variance.
We have calculated the variance of Set B by following the same steps given above. The result of the variance of Set B is shown below.
Example #3 – Calculating the quantum of variance for data in excel
We may just want to calculate the variance in the data, and we may need the variance in terms of quantity and not in terms of data analysis.
If we need to check the change, then we need to use the following method.
Step 1 – Calculate the difference that is between the two of the data by using the function of subtraction.
Step 2 – After pressing the Enter key, we will get the result. To get the entire data variance, we have to drag the formula applied to cell C2.
Step 3 – Now, the variance can be positive and negative, and this will be the calculated variance.
Example #4 – Calculating the percentage of variance for the data set in excel
We may need to calculate the percentage change in the data over a period of time, and in such cases, we need to use the below method.
Step 1 – First, calculate the variance from method 3rd.
Step 2 – Now calculate the percentage by using the below function.
Change in the value/original value*100. This will be our percentage change in the data set.
Step 3 – To get the percentage of the entire data variance, we have to drag the formula applied to cell D2.
Things to Remember About Variance in Excel
- If we have data set that represents the complete population, then we need to use the function of VAR.P.
- If we have a data set that represents the samples from the world data, then we need to use the function of VAR.S.
- Here S represents the samples.
- If we are calculating the change in terms of quantum, then a negative change means an increase in actual value and a positive change means a decrease in value.
- In the case of using the VAR.P, the arguments can be number or name, arrays or reference that contains numbers.
- If any of the cells that have been given as a reference in the formula contains an error, then that cell will be ignored.
Recommended Articles
This is a guide to Variance in Excel. Here we discussed How to calculate Variance in Excel along with practical examples and a downloadable excel template. You can also go through our other suggested articles –
- Top 25 Useful Advanced Excel Formulas and Functions
- FLOOR Function in Excel
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- Excel Variance
Want to know how to calculate Variance in Excel?
But wait!!
Do you even know how you can use variance in real life?
Some of you might not have any idea about it. Let me explain first where you can see that application of variance.
Example 1: You all have heard that the stock market has an average return of some percentage. It does not mean each year you get that percentage return. It can be less in a year or higher in the next year. Now, this is the variance or variability that you see in the stock market.
Another Example: Suppose you drive to the office and take a route daily. But you found that there is variability in the daily timing when you reach the office. Well, the variability could be because of the stop-light timing, traffic, and more. Moreover, the variability in the gas is also seen. All these variabilities can be calculated using the concept of variance.
Why use Excel for calculating variance. The simple answer to it is:
- Excel offers several statistical formulas to apply directly.
- Apart from this, Excel can help you to manage large data collected from different sources.
- Excel also makes your work easier and simple.
Now, let’s jump to the details about how to calculate variance in Excel. But first, know what variance is (technically).
What is the variance?
It is the calculation of the spread numbers in a data set file. Or it is the measurement of the variability of the given data set that represents how far a difference value is spread. In the mathematical term, it is the average of the squared of the calculated difference from the mean.
Variance Formula in Excel:
x_i = the value of the one observation
bar{x} = the mean value of each and every observation
n = the number of observations
For a better understanding of how to calculate variance in excel, let’s take an example of it:
Assume, there are 5 monkeys in a zoo that are 10,6,14,8, and 2 years old. Find the variance of it.
- Measure the mean of these five numbers:
Mean = (10+6+14+8+2)/5 = 8
- Subtract the mean value to get the difference. To represent it, plot the difference as:
- Square each calculated difference.
- Measure the average of the square differences:
variance = {6^2+2^2+0^2+(-2)^2+(-6)^2}/5 = 16.
Therefore, the variance of the given data is 16.
Things you should keep in mind before calculating Variance in Excel
There are some of the things that you should know before calculating the variance. Particularly, you should consider:
While VAR.S and VAR can change technically, VAR.S can replace the Excel function for the data. Also, VAR.P for the population data set must use over the VARP as the new function.
For counting logical or text values, you should use VARPA (for population) or VARA (for samples).
A single argument (value 1) is necessary for the reference to a cell’s range. But finding the variance from the single value is quite redundant. Therefore, you should use more arguments for this.
Users can also use the reference to cell ranges or reference every value individually.
VAR.S, VARP, VAR, and VARP only support the value in the numeric.
If you want to learn how you can calculate variance in excel then, Get the best excel homework help from the experts
There are different functions to calculate the variance in Excel, which are: VAR.S, VAR.P, VARPA, VAR, VARP, and VARA. One can use any of the variance formulas to determine factors such as:
- Whether one measures population or sample variance.
- The excel version which one is using.
- Whether one wishes to ignore or evaluate logical and text values.
Different excel variance functions
We have provided a brief description of the various functions that are accessible in Excel that help one to select the formula as per the need.
| Name | Excel version | Data type | Logical and Text |
| VAR.S | 2010-2019 | Sample | Ignored |
| VAR.P | 2010-219 | Population | Ignored |
| VARPA | 2000-2019 | Population | Evaluated |
| VAR | 2000-2019 | Sample | Ignored |
| VARP | 2000-2019 | Population | Ignored |
| VARA | 2000-2019 | Sample | Ignored |
Methods for how to calculate variance in excel (sample)
The sample is the set of the extracted data from the whole population, and the variance which is used for calculating the sample value is known as sample variance.
Let’s take an example, if one wants to calculate the individual’s height, then it is calculated for 1000 individuals, and the assumed height of the entire population is based on the sample.
Sample variance formula to calculate the value as:
Where x bar is the simple average of the given values, and n is the number value of the sample.
Then the three different sample variance is used to calculate by VAR, VAR.S, and VARA.
VAR function for sample variance in excel
It is one of the oldest functions in excel to predict the variance of the sample. The VAR function is accessible for the excel 2000 to 2019 version.
VAR (number1, [number2], ….)
NOTE: In 2010 excel, this function was replaced by VAR.S, which helps in improving accuracy. But, VAR is also available now for backup compatibility, in the current excel version, VAR.S is used for calculating the variance in excel.
VAR.S function for sample variance in excel
It is one of the modern counterparts for the current version of Excel, which is used in excel 2010 and later versions of excel.
VAR.S (number1, [number2], …)
VARA function for sample variance in excel
It is used to return the value of sample variance, which is based on the set of text, numbers, and logical values.
VARA (value1, [value2], …)
Example of sample variance in excel
When one is working with the numeric sets of data, then they can use the functions to measure the sample variance of an excel sheet. Let’s take an example of it, and measure the variance of the sample, including the 6 items (B2: B7). then, the formula will be as:
= VAR (B2: B7)
=VAR.S (B2: B7)
=VARA (B2: B7)
Add a simple variance video here
To check the accuracy of the data, let’s calculate it manually too:
- Calculate the average using the AVERAGE function as to put in the empty cell B8:
= AVERAGE (B2: B7)
- Subtract the calculated average value from every number of the sample and put the value in column C2.
=B2-$B$8.
- Now, square each calculated difference and keep in data in column D2:
=C2^2
- Sum up the square of the difference and divide the outcome with the total number of data which is sample minus 1:
=SUM (D2: D7) / (6-1)
Now, it will represent the data as given below table:
Different excel variance functions
How to calculate variance in excel (population)
The population can be defined as a member of a given group, which is the observed value in a field of study. It is used to describe the data points of the spread entire population. The formula of population variance can be calculated as:
Where x bar is the mean value of the given population, and n is the size of the given population.
There are three different functions that are used to measure the population variance in excel: VARP, VAR.P, and VARPA.
VARP function for population variance in excel
This function is used to return the population variance, which is based on the whole set of population numbers. It can be accessible in the excel version of 2000 to 2019.
VARP(number1), [number2], ….)
NOTE: For the excel version of 2010, VARP is replaced by VAR.P, and it is suggested that try to use VAR.P in excel as the VARP function would be accessible for future excel versions.
VAR.P function for population variance in excel
It is used as the improved VARP function, which is accessible for excel 2010 and later versions.
VAR.P (number1, [number2], ….)
VARPA function for population variance in excel
It is used to measure the population variance value for the entire number of the set, logical value, and text. It is used in excel 2000-2019 versions.
VARA (Value1, [value2], ….)
Example of population variance in excel
In this example, there is an exam score of 5 students, which has the maximum value from the entire group of sets. If you gather data from the students, then the data represent the whole population and calculate the population variance. But let’s first know its formula:
Population Variance Formula:
Let’s take an example of 10 students (B2: B11), so the variance can be calculated as:
= VARP (B2: B11)
= VAR.P (B2: B11)
= VARPA (B2: B11)
Add simple variance video here
Excel can be the best option to calculate the variance, and one can judge the manual var as:
Pooled Variance Formula
In the statistics, the Pooled variance is a method used for estimating the variance of many different populations when the mean of each population may be different, but one can assume that the variance of each population is the same.
With the use of this method when you get the result of a numerical estimate, you can call this pooled variance.
n_i = sample size
y_i = the ith observation
y_j = sample mean of group j
Useful notes for how to calculate variance in excel
To calculate the variance in excel, follow the simple norms that make it easy to use:
- Give arguments as arrays, values, or cell references.
- For the 2007 or later version of Excel, one can use up to 255 arguments for a population or sample, but for 2003 or older versions of Excel, one can use 30 arguments.
- To get the value of references, ignore the text, empty cells, and logical values. Use the function VAR.S or VAR to calculate sample variance whereas for the population variance, use VAR.P or VARP functions.
- To get the text and logical values in references, VARPA or VARA functions can be used.
- Give approximately two numeric values for using the sample variance formula and a single numeric value for the population variance formula in the Excel sheet.
- The arguments that contain the text can not be interpreted and cause #VALUE! Errors for the numbers.
Conclusion
This blog has provided information on how to calculate variance in excel that including various types of functions used to measure sample and population variance. These functions are used for different versions of Excel, which start from 2000 to the 2019 year. One can easily use these functions and do their work with ease.
So, whenever one needs to calculate the variance of the excel data, use these above-mentioned functions, and measure the value easily. If you are facing any problem related to the statistics assignments, then you can contact our experts who are known for their high-quality content with zero plagiarism. They can deliver the data before the deadlines, and one can use our services at reasonable prices with accessibility 24/7. So, avail of our statistics services and score A+ grades in your academics. Get the best excel homework help from the experts
Also, Read
- How to Find Z Score in Excel
- How to Find Range in Excel
- How to Calculate Variance In Excel Using Different Functions
Frequently Asked Questions
What exactly is a variance?
In terms of statistics and probability, variance is the method to calculate how far the set is spread out. Moreover, it shows how much the random figure differs from the imaginary or expected value. We can define variance as the average of the differences’s square between the observed and expected value.
What are the different types of variance?
There are different types of variances. Some of those are:
Cost Variances.
Fixed Overhead Variance.
Profit Variance.
Labour Variances.
Material Variances.
Overhead (Variable) Variance.
Sales Variance.
What is Variance?
We use the variance of data to estimate the range of future value in series. The variance tells how much data can vary from the mean of the data set. Variance is often referred to as error value. It is not the most trusted statistic and we don’t use it alone to predict future value.
If speaking mathematically, Variance is an average of squared difference of data points from the mean of the data. Variance is the squared value of standard deviation. Below are the two formulas of variance.
We won’t need to use these formulas to calculate variance in Excel. Excel has two formulas VAR.P and VAR.S to do so. If you just want to know how to calculate variance in Excel use the formulas as described below. If you want to know what is variance and when to use which variance formula, read the whole article.
How to find Variance in Excel?
Let’s take an example.
I launched my website in Jan 2019. Here I have data of new users joined in every month on my website. I want to know the variance of this data.
This is complete data. When we capture complete data (entire population) we calculate the variance of population (why? I’ll explain it later in the article). The Excel function for calculating Variance of population is VAR.P. The syntax of VAR.P is
=VAR.P(number1,[number2],…)
Number1, number2,…: these are the numbers of which you want to calculate variance.
The first number is compulsory.
Let’s use this formula to calculate the variance of our data. We have data in cell C2:C15. So the formula will be:
This returns a value 186.4285714, which is quite a large variance given our data.
Since my website was launched in from Jan 2019, I have all the data. Assuming I launched my website long ago but the data that I have is only from Jan 2019 to Feb 2020. I don’t have complete data. It is only a sample data then. In that case, I will not use VAR.P instead I will use the VAR.S function to calculate the Variance.
The VAR.S function returns a larger variance than VAR.P. It returns 200.7692308.
How Variance is Calculated Manually in Excel?
So yeah, this is how you calculate Variance in Excel. But how do these variance functions calculate these numbers? If you know it you can understand these numbers more and use it wisely. Otherwise these numbers are just random numbers. To understand it, we need to calculate the variance manually.
Calculate Variance of Population Manually in Excel
We will use the same data that we used in the above example. The mathematical formula for Variance of Population is:
To calculate variance we need to calculate mean (AVERAGE) of data, difference of each value from mean, sum them up and finally divide that sum with the total number of observations.
Step 1. Calculate Mean of Data
To calculate mean of data in Excel we use the AVERAGE function.
Use this formula in cell C17 (or wherever you like).
This returns 233.0.
Step 2: Find the difference of each data point from mean
Now go to cell D2 and subtract mean (C17) from C2 (x). Use this formula in D2 and drag it down to D15.
Step 3: Squire Each Difference.
Now we need to square each difference we got here. In cell E2 write the formula below and drag down to E15:
Step 4: Sum The Squares
Now we need to sum up these squared differences. So use this formula in cell C18:
Final Step: Divide the Sum of Squares with number of observations.
I have 14 observations. You can calculate using the COUNT function if you want.
Use this formula in Cell C19 to calculate the Variance of population.
This returns the value 186.429… which is exactly the same as the variance returned by the Excel variance formula VAR.P above.
Now that you know how variance of population is calculated manually in Excel you will be able to know how to use it in actual analysis.
Calculate Variance of Sample Manually in Excel
In most of the cases it is impossible to capture all the data for analysis. We usually pick a random sample from the data and analyse it to interpret the nature of data. In that case we if we use the variance of population it can be destructive analysis. To be on the safe side, we use the Variance of Sample formula. The formula for the Variance of Sample is:
The only difference in sample and population variance is the denominator. In sample variance, we subtract one from the number of observations (n-1). This is called unbiased analysis. This ensures that the data is not underestimated and the possible error range is a bit wider.
To calculate the variance of sample manually in Excel, we need to repeat steps 1 to 4 of variance of population. In the final step use the below formula:
This returns 200.769. This is exactly the same as the variance returned by the function VAR.S. It takes a larger error range than VAR.P to ensure less chance of mistakes in prediction.
The variance of data is not that trusted for prediction. We calculate standard deviation which is the square root of variance and many other statistics to minimize the chances of error in prediction.
So yeah guys, this is how you can calculate variance in excel. I hope it was explanatory and helpful. If you have any doubts about this variance in excel or any other statistics, the comments section is all yours.
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In this tutorial, I will demonstrate how to calculate the variance in Microsoft Excel. Specifically, I will show you how to calculate the variance of a sample, as well as a population.
What is variance?
To begin with, let me quickly explain what the variance is.
Variance is a measure of variability.
Simply, it is calculated by taking the average of squared deviations from the mean. The resulting value, known as variance, tells you the degree of spread in your data.
The larger the variance value, the more spread the data is in relation to the mean.
Calculating the variance in Excel will differ slightly depending on whether you want to calculate the variance for a sample or a population.
Calculating variance of a sample
I’ll start by calculating the variance for a sample, which is probably what most people are interested in.
In my Excel sheet, I have some example data.
Let’s say I am interested in a rare fish called Fish X. What I’ve done is take a sample of 15 Fish X fishes and measured their length in centimetres.
To calculate the variance of a sample in Excel, use the VAR.S function.
=VAR.S(number1, [number2], ...)
Within the parenthesis, add in the cells containing your data.
Here is what my formula looks like for the Fish X example.
The variance for my sample is 389.924.
The units for the variance are the same as the original measurement squared; so my variance is in fact 389.924 cm2.
[Optional] Calculating the standard deviation from the variance in Excel
If you’re wondering, you can calculate the standard deviation from the variance by simply square rooting the variance. You do this by using the SQRT function.
=SQRT(number)
- number – Replace this with the cell containing the variance value
The standard deviation comes out to be 19.7465.
The units for this will be the same as the original units for my data, so this would be centimetres.
Calculating variance of a population
I’ve got a different dataset now. This time, I have the data for all the Fish X fishes in the world; in total there are 100. So, what I have here is known as a population.
Calculating the variance of a population involves a slightly different function compared with the sample variance. This time, we will use the VAR.P function.
=VAR.P(number1, [number2], ...)
Again, within the parenthesis, add in the range of cells containing your data.
I get a result of 341.12.
Again, this will have the units cm2.
How to calculate variance in Excel: Wrapping up
Now you know how to calcuate the sample and population variance in Microsoft Excel.
To calculate the sample variance, use the VAR.S function. If you’re wanting to calculate the variance of a population, then use the VAR.P function instead.
Microsoft Excel version used: 365 ProPlus