R-squared explains to what extent the variance of one variable explains the variance of the second variable.
Therefore, if the R2 of a model is 0.50, then approximately half of the observed variation can be explained by the model's inputs.
R-squared values range from 0 to 1 and are commonly stated as percentages from 0% to 100%.
An R-squared of 100% means that all movements of a security are completely explained by movements in the index.
R-Squared is a statistical measure of fit that indicates how much variation of a dependent variable is explained by the independent variable(s) in a regression model.
R2=1- Unexplained Variation/Total Variation