ANSWER # 1 Factor Loadings:

The factor loadings, also called component loadings in PCA, are the correlation coefficients between the variables (rows) and factors (columns). Analogous to Pearson's r, the squared factor loading is the percent of variance in that indicator variable explained by the factor. To get the percent of variance in all the variables accounted for by each factor, add the sum of the squared factor loadings for that factor (column) and divide by the number of variables. (Note the number of variables equals the sum of their variances as the variance of a standardized variable is 1.) This is the same as dividing the factor's eigenvalue by the number of variables.

Interpreting Factor Loadings:

By one rule of thumb in confirmatory factor analysis, loadings should be .7 or higher to confirm that independent variables identified a priori are represented by a particular factor, on the rationale that the .7 level corresponds to about half of the variance in the indicator being explained by the factor. However, the .7 standard is a high one and real-life data may well not meet this criterion, which is why some researchers, particularly for exploratory purposes, will use a lower level such as .4 for the central factor and .25 for other factors call loadings above .6 "high" and those below .4 "low". In any event, factor loadings must be interpreted in the light of theory, not by arbitrary cutoff levels. In oblique rotation, one gets both a pattern matrix and a structure matrix. The structure matrix is simply the factor loading matrix as in orthogonal rotation, representing the variance in a measured variable explained by a factor on both a unique and common contributions basis. The pattern matrix, in contrast, contains coefficients which just represent unique contributions. The more factors, the lower the pattern coefficients as a rule since there will be more common contributions to variance explained. For oblique rotation, the researcher looks at both the structure and pattern coefficients when attributing a label to a factor. Naming of Factors: Once all significant loadings are identified, the analyst attempts to assign some meaning to the factors based on the patterns of the factor loadings. To do this, the analyst examines the significant loadings for each factor (column). In general, the larger the absolute size of the factor loading for a variable, the more important the variable is in interpreting the factor. The sign of the loadings also needs to be considered in labeling the factors. It may be important to reverse the scoring of the negatively worded items in Likert-type instruments to prevent ambiguity. That is, in Likert-type instruments some items are often negatively worded so that high scores on these items actually reflect low degrees of the attitude or construct being measured. Remember that the factor loadings represent the correlation or linear association between a variable and the latent factor(s). Considering all the variables' loading on a factor, including the size and sign of the loading, the investigator makes a determination as to what the underlying factor may represent.

ANSWER # 2
The first decision that a researcher must make is to decide whether he/she wants the factors to be correlated (i.e., oblique rotation) or uncorrelated with one another (i.e., orthogonal rotation).There are advantages and disadvantages to using either rotation procedure or the researchers decision depends upon the researchers goals. As a general rule, if a researcher is primarily concerned with getting results that "best fit" his/her data, then the researcher should rotate the factors obliquely. If on the other hand the researcher is more interested in the generalizability of his/her results, then orthogonal rotation should be conducted instead. However, results from an oblique rotation and an orthogonal rotation almost always produce generally similar results. Therefore, orthogonal rotation is almost always the preferred choice. Unless the results from an oblique rotation drastically differ (i.e., radically improve interpretation) from those of an orthogonal rotation, oblique rotation should generally not be done. The purpose of research is to enhance and promote knowledge in the area being investigated, therefore, being able to generalize ones findings becomes of utmost importance to researchers. There are two elements which effect whether oblique and orthogonal rotation will produce similar results: (a) the factor to variable ratio and (b) the degree of correlation between the factors. When the factor to variable ratio is small, both oblique and orthogonal rotation will produce similar results. When this ratio is small, simple structure will tend to be the same regardless of which type of rotation is used. In addition, the smaller the correlation (i.e., the closer to zero) between the factors, the more likely oblique and orthogonal rotation will produce similar results. After deciding upon either oblique or orthogonal rotation, researchers must make a second decision. Within both oblique and orthogonal rotation, there are many different rotation techniques that may be used. For example, if a researcher does an oblique rotation, the researcher can choose to do an oblimin or a promax rotation procedure. Within orthogonal rotation, a researcher may choose to do a varimax or quartimax or some other orthogonal procedure. There are many types of orthogonal and oblique rotational strategies (e.g., maxplane, orthomax, or equamax) from which a researcher can choose. The procedures listed above are the most widely used.

OBLIQUE ROTATION:
As previously mentioned, there are disadvantages and advantages to using either procedure. An oblique rotation is useful for two reasons. To begin with, an oblique rotation is more representative of the nature of reality. This is because an oblique rotation allows the factors to be correlated with one another. In the real world it is very unlikely that the factors would have a zero correlation with one another.

A second advantage (or disadvantage depending on the researchers goal) of an oblique rotation is that oblique rotation provides results that "best fit your data". In other words, oblique rotation is strongly influenced by sample specific measurements (e.g., degree of correlation between the factors). The degree of correlation between factors will vary from one study to the next-no two studies will have identical factor matrices. As a consequence, the results obtained by an oblique rotation will be less likely to be replicated by future studies. This occurs because of sampling error. In an oblique rotation, the researcher is estimating a greater number of coefficients than in an orthogonal rotation, so there are more opportunities for sampling error to influence the results. The factor pattern matrix is not equal to the factor structure matrix in an oblique rotation. The factor structure matrix is comprised of the bivariate correlations between the variables and the factors. Since the factors are correlated with one another, the factor pattern matrix and the factor structure matrix will not be the same. However, the factor structure matrix and the factor pattern matrix are identical in an orthogonal rotation in which case the researcher is estimating fewer coefficients than in an oblique rotation. Another problem with the results of an oblique rotation is that the interpretation is more complex. The researcher is not only required to provide an explanation of the underlying factor structure but must also explain the correlations among the factors.

ORTHOGONAL ROTATION:
By now some of the advantages and disadvantages of using orthogonal rotation should be obvious. While oblique rotation provides a result that "best fits" the researchers sample data, orthogonal rotation provides a solution that "best fits" past and future data. In essence, the results of an orthogonal rotation are more likely to be replicated in future studies and to have been found by previous investigators. This occurs because there is less sampling error in an orthogonal rotation, since an orthogonal rotation also produces results that are more parsimonious. Additionally, since the factors are uncorrelated with each other, the interpretation of orthogonally rotated factors is much simpler than that of obliquely rotated factors. Hetzel (in press) noted: with an oblique rotation it is important to consult the factor structure coefficients in addition to the factor pattern coefficients. This is unnecessary after orthogonal rotation, since the orthogonality of the factors meant that the factor pattern coefficients and structure coefficients were identical. Unfortunately, while the results may be easier to explain, the results do not honor the nature of reality.

Quantitative Techniques in Analysis

Assignment # 02
Name: Mansoor Baig

Registration #:

10436

Submitted to:

Sir Ibrahim Shamsi

Submission Date:

Nov. 18, 2011