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Feature Engineering — The Art That Makes or Breaks Your Model

A scroll-driven visual deep dive into feature engineering. Learn transformations, encoding, interaction features, handling missing data, and why feature engineering matters more than model choice.

Introduction 0%
Introduction
🎯 0/3 0%

Data Preparation

Better data beats
better algorithms.

Feature engineering transforms raw data into features that make ML models more powerful. The top Kaggle winners spend 80% of their time on features, 20% on models. A simple model with great features outperforms a complex model with raw data. Every time.

Encoding

Encoding Categorical Variables

Label EncodingRed → 0, Blue → 1, Green → 2⚠ Implies order (2 > 1 > 0)⚠ Green “bigger” than Red?✓ OK for ordinal: S < M < L < XL✓ OK for tree-based modelsBad for linear modelsOne-Hot EncodingRed → [1, 0, 0]Blue → [0, 1, 0]Green → [0, 0, 1]✓ No false ordering⚠ High cardinality = many columnsSafe default for most modelsTarget EncodingRed → 0.85 (mean target for Red)Blue → 0.32Green → 0.67✓ Great for high cardinality⚠ Target leakage risk!Advanced: use with CV folding
Three encoding strategies for categorical features
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🟢 Quick Check Knowledge Check

You have a 'city' column with 10,000 unique cities. One-hot encoding would create 10,000 new columns. What's the better approach?

Transforms

Numerical Transformations

Common feature transforms

📉 Log Transform

Compresses right-skewed distributions like income or price by squashing the long tail. Makes relationships more linear and reduces the outsized influence of extreme values.

x → log(1 + x)
📏 Standardization

Centers data to zero mean and scales to unit variance. Required for distance-based models (KNN, SVM), PCA, and any model using gradient descent or regularization.

x → (x − μ) / σ
📐 Min-Max Scaling

Rescales features to a fixed [0, 1] range. Good for neural networks and algorithms sensitive to feature magnitude, but outliers compress the useful range.

x → (x − min) / (max − min)
Power Transforms

Box-Cox and Yeo-Johnson automatically find the optimal power transformation to make data more Gaussian. Use sklearn's PowerTransformer when you don't know which transform to pick.

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🟡 Checkpoint Knowledge Check

Why does log-transforming a right-skewed feature (e.g., income) improve linear regression?

Interaction Features

Creating New Features from Existing Ones

Feature interactions and domain features

🤝 Interaction Features

Multiply two features together to capture effects that depend on BOTH variables. For example, bedrooms × bathrooms creates a house quality proxy that neither feature captures alone.

x₁ × x₂
Ratio Features

Dividing one feature by another often yields more meaningful signals than raw values. Price per square foot, clicks per impression (CTR), and revenue per user are classic examples.

x₁ / x₂
📈 Polynomial Features

Squaring, cubing, or taking roots of features captures nonlinear relationships. For example, age² models the U-shaped relationship between age and income.

x², x³, √x
📅 Date Features

Raw timestamps are useless to models. Extract year, month, day_of_week, is_weekend, days_since_event — these temporal patterns are where the predictive power lives.

Missing Data

Handling Missing Values

Simple Imputation• Mean/median for numerical• Mode (most frequent) for categorical• Constant (0, -999, “MISSING”)Quick and usually sufficientAdvanced Imputation• KNN imputation (similar rows)• Iterative (model-based, like MICE)• Multiple imputation (uncertainty-aware)Better but slower🔑 Pro Tip: Missingness IS a FeatureAdd a binary column: “is_feature_X_missing” → The FACT that data is missing is often predictive!e.g., income=NaN in a survey → person chose not to answer → likely high or low incomeAlways add an “is_missing” indicator when imputing — free predictive signal!
Strategies for missing data — from simple to sophisticated
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🔴 Challenge Knowledge Check

You compute mean imputation on the FULL dataset (train + test) before splitting. What's wrong?

Feature Selection

Less Can Be More

🎓 What You Now Know

One-hot encode nominal, label encode ordinal — Target encoding for high cardinality.

Log-transform skewed features — Standardize for distance/gradient-based models.

Create interactions and ratios — Domain knowledge encoded as features beats model complexity.

Impute properly: train stats only — Add “is_missing” indicators for free signal.

Features > algorithms — Time spent on features gives better ROI than model tuning.

Feature engineering is where science meets art. The science: mathematical transformations, proper encoding, statistical imputation. The art: knowing which features to create from domain expertise. Master both, and you’ll outperform any AutoML tool. 🎨

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