In this plot, the ordered residual (or observed quantiles) of the residuals are plotted aginst the expected quantiles assuming that ϵi's are approximately normal and independent with mean ...In this plot, the ordered residual (or observed quantiles) of the residuals are plotted aginst the expected quantiles assuming that ϵi's are approximately normal and independent with mean 0 and variance = MSE. Heteroscedasticity or unequal variance: the variance of the error ϵi may sometimes depend on the value of Xi. This is often true for financial data, where the volume of transactions usually has a role in the uncertainty of the market.
