Hey Wayne,
Thanks again for you prompt response. I understand what you are saying about how Matlab makes this calculation when the 'coef' option is used. What I am trying to better understand is whether it makes sense to say that the lagged sine function is less correlated as lags increase as the normalized output does('coef' option). As the example showed xcorr(ts,'coef') has a value .76 at lag 120, even though the lagged time series actually perfectly correlated if we compared the two time series in an unbiased way (i.e. lagging one of the two sine curves by 120 would have both shorten times overlaying each other). Shouldn't the process of normalizing the result be done in an unbiased way? Does this clarify what I am trying to get at?
Thanks again!
Brian Dz