TIME

SERIES
ANALYSIS
 TIME SERIES CAN BE DEFINED AS A
SET OF NUMERIC OBSERVATIONS
OF THE DEPENDENT VARIABLE,
ARRANGED IN CHRONOLOGICAL
WHAT IS ORDER.
TIME
SERIES? THE ANALYSIS OF MOVEMENTS OF
SUCH VARIABLES IS
REFERRED AS TIME SERIES
ANALYSIS.
 • A time series is a set of
observation taken at
specified times, usually at
„equal intervals‟.
Mathematical • Mathematically a time
presentation series is defined by the
of Time Series values Y1, Y2…of a variable
Y at times t1, t2…. Thus,
Y= F(t)
Importance

From finance to climate forecasting, time series

analysis is crucial for predicting future
outcomes and making informed decisions.

Applications

Learn how time series analysis is used in

diverse fields, including economics, stock
market analysis, and environmental monitoring.
COMPONENTS OF TIME SERIES

SEASONAL CYCLIC IRREGULAR

SECULAR
VARIATION VARIATION ( VARIATION
TREND (T)
(S) C) (I)
Trend: In which there is no fixed interval and any divergence within the given
dataset is a continuous timeline. The trend would be Negative or Positive or
Null Trend

Seasonality: In which regular or fixed interval shifts within the dataset in a

continuous timeline.

Cyclical: In which there is no fixed interval, uncertainty in movement and its

pattern

Irregularity: Unexpected situations/events/scenarios and spikes in a short

time span.
 EXAMPLE
• Consider an example of railway
passenger data over a period of
time.
• On the X-axis, we have years,
and on the Y-axis, you have the
number of passengers.
 • There are two major types – stationary and
non-stationary.
Stationary: A dataset should follow the below
thumb rules without having Trend, Seasonality,
Cyclical, and Irregularity components of the time
series.
Data Types • The mean value of them should be completely
of Time constant in the data during the analysis.

Series • The variance should be constant with respect

to the time-frame
Covariance measures the relationship between
two variables.
Non- Stationary: If either the mean-variance or
covariance is changing with respect to time, the
dataset is called non-stationary.
 • Time series forecasting
is the process of
analyzing time series
data using statistics and
modeling to make
predictions and inform
FORECASTING strategic decision-
making.
• Forecasting might refer
to data at a specific
future point in time.
ARIMA MODEL
• ARIMA is an acronym that stands for Auto-Regressive Integrated
Moving Average.

Understand the signature of ARIMA

• p==> log order => No of lag observations.
• d==> degree of differencing => No of times that the raw observations
are differenced.
• q==>order of moving average => the size of the moving average window
• AR ==> Uses past values
to predict the future.
• MA ==> Uses past error
terms in the given series
to predict the future.
• I==> Uses the
differencing of
observation and makes
the stationary data.
AR+I+MA= ARIMA
Steps to Use ARIMA Model
1. Visualize the Time Series Data
2. Identify if the date is stationary
3. Plot the Correlation and Auto Correlation
Charts
4. Construct the ARIMA Model or Seasonal
ARIMA based on the data
 See how time series
analysis drives accurate
Financial Forecasting predictions for stock
market trends and
economic modeling.

Applications
Learn how time series
of Time Demand Forecasting
analysis helps optimize
inventory management
Series and meet customer
demands
Analysis
Explore how time series
analysis assists in
Climate Forecasting predicting weather
patterns and monitoring
environmental changes.
CONCLUSION
• Time series analysis has a wide range of
applications and is one of the most
important areas of study. It plays an
important role in forecasting models and
meaningful statistical characteristics.
THANK YOU
BY:
-PRANATHI
-ASHRITHA
-HASINI
-HRISHIKES H