Serial correlation is the degree of similarity between two time series over successive time intervals. In other words, it is the similarity between security prices in two or more time series, when affected by the same parameters.
Serial correlation can vary between -1 and 1. If the result of mathematical representation is 1, it says that if the stock was rising in the past, there will be proportional rise in the future if affected by the same conditions. If the result is -1, correlation is negative, which means that if the stock was rising in the past, there will be a proportional decrease in the future if impacted by the same conditions.
