In Finance, What are Time Series Models?
Within the field of finance, specifically statistics and financial mathematics, time series models are a system in which researchers can determine the likely outcome of a particular data stream. Essentially, time series models allow an analyst to forecast how well a financial security will perform over a specific interval of time. Using past events as a point of reference, time series models measure the historical data and establish a prediction of where that security stands in the future based on its previous performance. One of the most common methods of technical forecasting includes the analysis of moving averages, as used by people who study econometrics, the analysis of economic data. For example, modeling variations can be created using the performance average of a particular stock at closing bell over the course of six months, providing an acceptable prediction of its future value.
