ARCH/GARCH Modeling

The NumXL ARCH/GARCH modeling wizard automates the steps used to construct an ARCH model: guessing initial parameters, parameter validation, the goodness of fit testing, and residuals diagnosis.

Process

To use this functionality, select the corresponding icon on the toolbar (or the menu item).
In this figure, we show the ARCH/GARCH model icon in the NumXL toolbar.

Point to the data sample on your worksheet, select the corresponding orders of the Autoregressive Conditional Heteroskedasticity (ARCH) component model and the Moving Average (GARCH) component model, the goodness of fit tests, residual diagnosis, and designate a location on your worksheet to print the model.
In this figure, we show the NumXL ARCH/GARCH wizard dialog

Output

Upon completion, the GARCH modeling function prints the selected model's parameters and tests/calculations in the designated location of your worksheet.

In this figure, we show the generated E-GARCH model table


Video

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