Analytics for the Internet of Things (IoT)

Area Under the Curve (AUC)

AUC is simply the portion of the ROC chart "square" that is underneath the ROC curve of the ML. Since it is a proportion, it will always range from 0 to 1. An AUC of 1 represents a curve that covers the entire graph, and therefore it is perfectly aligned to the upper-left corner. This would be the aforementioned rarely observed, yeti-like perfect model.

The random model represented by the dashed line in the ROC chart has an AUC of 0.5. So, in real world situations, you will be looking at AUC numbers from 0.5 to 1.0. How to interpret an AUC number depends a lot on the industry and business situation. An AUC of 0.6, indicating better than random, may be a fantastic model for stock picking in the finance industry; ...