Factor regression model
Within statistical factor analysis, the factor regression model, or hybrid factor model, is a special multivariate model with the following form:
where,
Relationship between factor regression model, factor model and regression model
The factor regression model can be viewed as a combination of factor analysis model and regression model.Alternatively, the model can be viewed as a special kind of factor model, the hybrid factor model
where, is the loading matrix of the hybrid factor model and are the factors, including the known factors and unknown factors.