Finally had a chance to play around with Kaggle challenge, and bike sharing demand seems to be the easiest to tackle - no domain expertise required or atleast very minimal.

This is going to be **Part 1** where I'll go over how I apply minimal statistical knowledge to extract features. Well, extraction and selection to be exact. From these features, I fed them into Random Forest (from Scikit-Learn) which hopefully will be covered in Part 2. The result I got so far is mediocre, I plan to play around with features and try different algos later when I have the time. My final target is to get score below 0.5 or around 0.4 at best before I give up :( If some of the reasoning are wrong let me know, although I have background in Actuarial Science, it has been quite a while.

## Feature selection

I will be using R to toy around with the data.

Since this is going to be a regression problem (predicting a continous value), I would like to start simple with linear regression to see how things first.

```
> str(bike)
'data.frame': 10886 obs. of 14 variables:
$ datetime : Factor w/ 10886 levels "2011-01-01 00:00:00",..: 1 2 3 4 5 6 7 8 9 10 ...
$ season : int 1 1 1 1 1 1 1 1 1 1 ...
$ holiday : int 0 0 0 0 0 0 0 0 0 0 ...
$ workingday: int 0 0 0 0 0 0 0 0 0 0 ...
$ weather : int 1 1 1 1 1 2 1 1 1 1 ...
$ temp : num 9.84 9.02 9.02 9.84 9.84 ...
$ atemp : num 14.4 13.6 13.6 14.4 14.4 ...
$ humidity : int 81 80 80 75 75 75 80 86 75 76 ...
$ windspeed : num 0 0 0 0 0 ...
$ casual : int 3 8 5 3 0 0 2 1 1 8 ...
$ registered: int 13 32 27 10 1 1 0 2 7 6 ...
$ count : int 16 40 32 13 1 1 2 3 8 14 ...
$ time : Factor w/ 24 levels "00","01","02",..: 1 2 3 4 5 6 7 8 9 10 ...
$ day : Factor w/ 7 levels "Friday","Monday",..: 3 3 3 3 3 3 3 3 3 3 ...
```

`time`

and `day`

are some of the variable that I extracted from `datetime`

. I could do so for `month`

as well. There is no statistical basis behind this, it's just purely from intuition/knowledge. But, we will let stats decide if these features are worthy.

```
> model1 <- lm(count ~ season + holiday + workingday + weather + temp + atemp + humidity + windspeed, data=bike)
> summary(model1)
Call:
lm(formula = count ~ season + holiday + workingday + weather +
temp + atemp + humidity + windspeed, data = bike)
Residuals:
Min 1Q Median 3Q Max
-335.81 -102.67 -31.95 66.44 677.02
Coefficients:
Estimate Std. Error t value Pr(>|t|)
(Intercept) 135.79052 8.71016 15.590 < 2e-16 ***
season 22.75882 1.42662 15.953 < 2e-16 ***
holiday -9.15872 9.27009 -0.988 0.323181
workingday -1.14953 3.31527 -0.347 0.728795
weather 5.93872 2.61924 2.267 0.023389 *
temp 1.84737 1.14210 1.618 0.105796
atemp 5.63120 1.05057 5.360 8.49e-08 ***
humidity -3.05684 0.09262 -33.003 < 2e-16 ***
windspeed 0.77762 0.19999 3.888 0.000102 ***
---
Signif. codes: 0 ‘***’ 0.001 ‘**’ 0.01 ‘*’ 0.05 ‘.’ 0.1 ‘ ’ 1
Residual standard error: 155.8 on 10877 degrees of freedom
Multiple R-squared: 0.2609, Adjusted R-squared: 0.2604
F-statistic: 480 on 8 and 10877 DF, p-value: < 2.2e-16
```

Our R-squared is not that great. Maybe we can improve this by excluding some features. Usually features with * is considered as important when evaluating the model. One thing to note is that `atemp`

(feels like) has 3 *'s while `temp`

does not have any. This is quite misleading. `temp`

should also be equally important. However, because the correlation between `temp`

and `atemp`

is ` 0.9849481`

(highly correlated), the other information is already being 'captured' by the other variable. So deleting one of this feature will result in minimal loss of information.

Let's take a look at `humidity`

. The co-efficient is negative - the relationship between `count`

and `humidity`

is inverse, the higher the humidity the lesser the bike rental. Since I am not a weather expert, I'm not sure how true is this, but let's see it on a graph so we can confirm this.

Well, the bike rental does get lesser as humidity increases although not smoothly (maybe there are some other factors influencing bike rental at this humidity level).

Another thing that I would like to do is to actually breakdown the rental between the `registered`

and `casual`

and to see if timings are actually affecting them. `Registered`

user might use bike for works, and `casual`

might use for leisure purpose. Let's see this on graph.

Looking at the graph, we can confirm our assumption. We can actually do a separate model to predict for `casual`

and `registered`

. Some of the features might remain the same, but for time, we might model them differently. Once we have the count for casual and registered, we can total them to get the predicted count.

These are some of my thought process when given data. I applied the same simple methodology for any other features like `windspeed`

, `day`

(Sunday is somehow important), etc. Try to analyze the data and later feed them into a model.