# What is sum encoding?

I've heard sum encoding mentioned as a method of encoding categorical variables, but I haven't been able to find a clear explanation of what it actually is.

I found the following explanation on Towards DataScience:

Just like OneHot except one value is held constant and encoded as -1 across all columns.

But this confused me as it doesn't involve any summing.

Is it really just?:

Value      Variable 1. Variable 2.
Red            1            0
Blue           0            1
Green         -1           -1