Dear Gretl community,

I want to create a index using five variables using gretl's principal components analysis and I would like to know if I'm doing it properly. I'll describe my steps:

Step 1: Compute principal components (Main window, View -> Principal components);
Step 2: Save all components (PC1, ..., PC5);
Step 3: index = PC1 + ... + PC5.

I know this is a silly little question, but I have no background in this kind of stuff :(


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