Theil's U Statistic

Theil's U statistic is a measure used to compare how well one set of data predicts another. It helps determine whether a forecasting model is more accurate than simply using the average of past data. A U value of 1 indicates the model is no better than guessing based on the average, while a U less than 1 shows the model provides better predictions. If U is greater than 1, the model is worse than just using the average. This statistic helps evaluate and improve forecasting methods by quantifying their accuracy relative to a simple baseline.