The Variance is a statistical measure, that is commonly used across a set of values, to identify the amount that the values vary from the average value.
When your data set is a sample of a population, (rather than an entire population), you should use a slightly modified form of Variance, known as the Sample Variance. The equation for this is :
where x is the average (statistical mean) of the set of values, and n is the number of values.A full explanation can be found on the Wikipedia Variance page
The Excel VARA function calculates the sample variance of a supplied set of values.
The format of the function is :
Where the number arguments provide a minimum of 2 numerical values to the function. You can enter up to 255 number arguments to the Vara function in Excel 2007 or Excel 2010, but you can only enter up to 30 number arguments in Excel 2003.
Note that the Vara function is used when calculating the variance for a sample of a population (eg. if your data set records the individual heights of a sample of UK males). If you are calculating the variance for an entire population, you need to use the Excel Varpa function.
The following spreadsheet shows the Excel Vara function used to calculate the sample variance of the set of values in cells A1-A4 and in cells A1-A6.
The format of the functions are shown in the spreadsheet on the left and the resulting values are shown in the spreadsheet on the right.
Note that, in the spreadsheet above, the function in cell B2 includes the values in cells A5 and A6. In this case, the logical value TRUE in cell A5 is treated as the value 1 and the text in cell A6 is treated as the value 0. This is shown by the example in cell B3, in which cells A1 - A4 and the values 1 and 0 give the same result as the variance calculation for cells A1 - A6.
Further information and examples of the Excel Vara function can be found on the Microsoft Office website.
If you get an error from the Excel Vara Function, this is likely to be the #DIV/0! error:
|#DIV/0!||-||Occurs if fewer than 2 numerical values have been supplied to the function|