I want to know if I need to use ARCH/GARCH model for my time series. How can I use
McLeod.Li.test in R to do that and how should I interpret the result? the description in R help was not clear for me because in the example of the R help they used difference of the log of the time series and I do not know why? Also, how should I interpret the resulted plot?
R help example is like this:
data(CREF) r.cref=diff(log(CREF))*100 McLeod.Li.test(y=r.cref)