Principal component analysis with dummy variables as its indicators

[Rayinda Putri]

Hi all.
I am currently doing research where I need to generate a latent variable. I have read some methodologies to build up an index/latent variable and I am interested in using Principal Component Analysis. However, almost all of the variables I am using are dummy variables. My question is, am I allowed to use this method when the indicators that I use are dummy variables?

Thank you very much in advance.

[George Ford]

There's an example in the guide in the "tetrachoric" discussion. You've to set it up with tetrachoric (dummies) or polychoric (categorical) commands first.