Chapter 15 Factor Analysis
Observed events tend to co-occur for a reason. Consider physical symptoms such as a fever, cough, sore through etc. These are often observed characteristics of an underlying event such as a viral infection. Now, not all individuals express the same symptoms, or event the same severity of symptoms, but we would say that there is a strong correlation between symptoms and underlying disease.
Factor analysis aims to understand the patterns of correlations between the underlying disease, and observed symptoms.