Abstract
A common problem for both principal component analysis and image component analysis is determining how many components to retain. A number of solutions have been proposed, none of which is totally satisfactory. An alternative solution which employs a matrix of partial correlations is considered. No components are extracted after the average squared partial correlation reaches a minimum. This approach gives an exact stopping point, has a direct operational interpretation, and can be applied to any type of component analysis. The method is most appropriate when component analysis is employed as an alternative to, or a first-stage solution for, factor analysis.
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Reference note
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Velicer, W.F. Determining the number of components from the matrix of partial correlations. Psychometrika 41, 321–327 (1976). https://doi.org/10.1007/BF02293557
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DOI: https://doi.org/10.1007/BF02293557