Seasonal adjustment

A B C D E F G H
1 Illustration of seasonal adjustment Unnormalized Normalized
2 on Outboard Marine data Seas. Index Seas. Index
3 115.872% 116.0504% F3: =4*E3/$E$7
4 112.776% 112.9497%
5 E3: =AVERAGE(D15,D19,D23,D27,D31,D35,D39,D43,D47) 68.508% 68.6136%
6 102.229% 102.3863%
7 C15:=(AVERAGE(B13:B16)+AVERAGE(B14:B17))/2 399.385% 400.0000%
8
9 D15: =B15/C15 F13: B13/E13
10
11 Date Original Trend-Cycle Ratio Seasonal Seasonally Irregular
12 Data (Ctr-Mov-Avg) (Seasonality) Index Adjusted Data
E15: =F15/C15
13 Dec-83 147.6 68.61% 215.118
14 Mar-84 251.8 102.39% 245.931
15 Jun-84 273.1 229.363 119.069% 116.05% 235.329 102.601%
16 Sep-84 249.1 224.500 110.958% 112.95% 220.541 98.236%
17 Dec-84 139.3 219.063 63.589% 68.61% 203.021 92.677%
18 Mar-85 221.2 218.750 101.120% 102.39% 216.045 98.763%
19 Jun-85 260.2 220.200 118.165% 116.05% 224.213 101.822%
20 Sep-85 259.5
E17: =E13 223.388 116.166% 112.95% 229.748 102.847%
21 Dec-85 140.5
copied down to231.250
repeat.. 60.757% 68.61% 204.770 88.549%
22 Mar-86 245.5
pattern of seasonal
239.513
indices 102.500% 102.39% 239.778 100.111%
23 Jun-86 298.8 246.488 121.223% 116.05% 257.474 104.457%
24 Sep-86 287.0 259.663 110.528% 112.95% 254.095 97.856%
25 Dec-86 168.8 281.138 60.042% 68.61% 246.015 87.507%
26 Mar-87 322.6 307.638 104.864% 102.39% 315.081 102.420%
27 Jun-87 393.5 333.663 117.934% 116.05% 339.077 101.623%
28 Sep-87 404.3 354.838 113.939% 112.95% 357.947 100.876%
29 Dec-87 259.7 373.538 69.524% 68.61% 378.496 101.328%
30 Mar-88 401.1 391.850 102.361% 102.39% 391.752 99.975%
31 Jun-88 464.6 401.863 115.612% 116.05% 400.343 99.622%
32 Sep-88 479.7 402.638 119.139% 112.95% 424.702 105.480%
33 Dec-88 264.4 396.163 66.740% 68.61% 385.346 97.270%
34 Mar-89 402.6 377.775 106.571% 102.39% 393.217 104.088%
35 Jun-89 411.3 362.088 113.591% 116.05% 354.415 97.881%
36 Sep-89 385.9 346.450 111.387% 112.95% 341.656 98.616%
37 Dec-89 232.7 322.200 72.222% 68.61% 339.146 105.259%
38 Mar-90 309.2 298.013 103.754% 102.39% 301.994 101.336%
39 Jun-90 310.7 282.950 109.807% 116.05% 267.729 94.620%
40 Sep-90 293.0 270.150 108.458% 112.95% 259.407 96.023%
41 Dec-90 205.1 257.638 79.608% 68.61% 298.920 116.024%
42 Mar-91 234.4 250.188 93.690% 102.39% 228.937 91.506%
43 Jun-91 285.4 244.413 116.770% 116.05% 245.928 100.620%
44 Sep-91 258.7 246.588 104.912% 112.95% 229.040 92.884%
45 Dec-91 193.2 251.138 76.930% 68.61% 281.577 112.121%
46 Mar-92 263.7 259.088 101.780% 102.39% 257.554 99.408%
47 Jun-92 292.5 264.288 110.675% 116.05% 252.046 95.368%
48 Sep-92 315.2 263.775 119.496% 112.95% 279.062 105.796%
49 Dec-92 178.3 265.488 67.159% 68.61% 259.861 97.881%
50 Mar-93 274.5 265.425 103.419% 102.39% 268.102 101.009%
51 Jun-93 295.4 116.05% 254.545
52 Sep-93 311.8 112.95% 276.052

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 Chart

600.0

500.0

400.0

Original data
300.0 Moving average
Seasonally adjusted

200.0

100.0

0.0
83 84 84 85 85 86 86 87 87 88 88 89 89 90 90 91 91 92 92 93
ec- un- ec- un- ec- un- ec- un- ec- un- ec- un- ec- un- ec- un- ec- un- ec- un-
D J D J D J D J D J D J D J D J D J D J

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 LES model

Illustration of seasonal adjustment Unnormalized Normalized

and linear exponential smoothing Seas. Index Seas. Index
on Outboard Marine data 115.872% 116.0504%
...use Solver to optimize alpha 112.776% 112.9497%
68.508% 68.6136%
102.229% 102.3863%
399.385% 400.0000%
RMSE = SQRT(error variance + square of mean error) Alpha
H9: =SQRT(VAR(H15:H52)+AVERAGE(H15:H52)^2) 0.471154

Date Original Centered Ratio Seasonal Seasonally LES

Data Moving Average Index Adjusted Data Forecast
Dec-83 147.6 68.61% 215.118 215.1
Mar-84 251.8 102.39% 245.931 215.1
Jun-84 273.1 229.4 119.07% 116.05% 235.329 244.2
Sep-84 249.1 224.5 110.96% 112.95% 220.541 242.7
Dec-84 139.3 219.1 63.59% 68.61% 203.021 226.7
Mar-85 221.2 218.8 101.12% 102.39% 216.045 204.4
Jun-85 260.2 220.2 118.17% 116.05% 224.213 210.1
Sep-85 259.5 223.4 116.17% 112.95% 229.748 220.7
Dec-85 140.5 231.3 60.76% 68.61% 204.770 229.7
Mar-86 245.5 239.5 102.50% 102.39% 239.778 208.7
Jun-86 298.8 246.5 121.22% 116.05% 257.474 234.9
Sep-86 287.0 259.7 110.53% 112.95% 254.095 260.0
Dec-86 168.8 281.1 60.04% 68.61% 246.015 263.3
Mar-87 322.6 307.6 104.86% 102.39% 315.081 254.5
Jun-87 393.5 333.7 117.93% 116.05% 339.077 315.3
Sep-87 404.3 354.8 113.94% 112.95% 357.947 354.8
Dec-87 259.7 373.5 69.52% 68.61% 378.496 380.2
Mar-88 401.1 391.9 102.36% 102.39% 391.752 401.7
Jun-88 464.6 401.9 115.61% 116.05% 400.343 415.1
Sep-88 479.7 402.6 119.14% 112.95% 424.702 421.7
Dec-88 264.4 396.2 66.74% 68.61% 385.346 441.8
Mar-89 402.6 377.8 106.57% 102.39% 393.217 406.5
Jun-89 411.3 362.1 113.59% 116.05% 354.415 399.4
Sep-89 385.9 346.5 111.39% 112.95% 341.656 359.4
Dec-89 232.7 322.2 72.22% 68.61% 339.146 335.1
Mar-90 309.2 298.0 103.75% 102.39% 301.994 327.4
Jun-90 310.7 283.0 109.81% 116.05% 267.729 292.9
Sep-90 293.0 270.2 108.46% 112.95% 259.407 252.9
Dec-90 205.1 257.6 79.61% 68.61% 298.920 237.2
Mar-91 234.4 250.2 93.69% 102.39% 228.937 275.0
Jun-91 285.4 244.4 116.77% 116.05% 245.928 224.9
Sep-91 258.7 246.6 104.91% 112.95% 229.040 227.8
Dec-91 193.2 251.1 76.93% 68.61% 281.577 216.7
Mar-92 263.7 259.1 101.78% 102.39% 257.554 265.9
Jun-92 292.5 264.3 110.67% 116.05% 252.046 260.5
Sep-92 315.2 263.8 119.50% 112.95% 279.062 253.1
Dec-92 178.3 265.5 67.16% 68.61% 259.861 276.3
Mar-93 274.5 265.4 103.42% 102.39% 268.102 265.3

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 LES model

Jun-93 295.4 116.05% 254.545 268.8

Sep-93 311.8 112.95% 276.052 256.8
Dec-93 68.61% 273.2 273.2
Mar-94 102.39% 275.8 275.8
Jun-94 F53: =G53 116.05% 278.4 278.4
:Bootstrapping begins here
Sep-94 112.95% 280.9 280.9
forecasts substituted for data
Dec-94 68.61% 283.5 283.5
Mar-95 102.39% 286.1 286.1
Jun-95 116.05% 288.6 288.6
Sep-95 112.95% 291.2 291.2

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 LES model

Auto(1)= -0.05 =CORREL($H$15:$H$51,$H$16:$H$52)

Auto(2)= 0.07 =CORREL($H$15:$H$50,$H$17:$H$52)
Auto(3)= 0.04 =CORREL($H$15:$H$49,$H$18:$H$52)
Auto(4)= 0.35 =CORREL($H$15:$H$48,$H$19:$H$52)
Auto(5)= -0.02 =CORREL($H$15:$H$47,$H$20:$H$52)

RMSE -Error auto Note that you can't simply

27.42136 correlations replicate the first formula
here--the endpoint of the first
LES Reseasonalized series inside the CORREL( )
Error Forecast formula DECREASES as the
0.0 147.6 row number increases
30.8 220.3
-8.8 283.3
-22.1 274.1
-23.7 155.5 I13: =G13*E13
11.7 209.2
14.1 243.8
9.0 249.3
-24.9 157.6 G15: =2*F14-F13-2*(1-Alpha)*H14+((1-
31.1 213.6 Alpha)^2)*H13 ....LES formula (first 2 forecasts =
22.6 272.6 1st actual value)
-5.9 293.7
-17.3 180.6
60.5 260.6
23.8 365.9
3.1 400.8
-1.7 260.9
-9.9 411.3 H13:
-14.7 481.7 =F13-
3.0 476.3 G13
-56.4 303.1
-13.3 416.2
-45.0 463.5
-17.8 406.0
4.0 230.0
-25.4 335.2
-25.1 339.9
6.5 285.7
61.7 162.8
-46.0 281.5
21.0 261.0
1.2 257.3
64.8 148.7
-8.3 272.2
-8.4 302.3
25.9 285.9
-16.4 189.6
2.8 271.6

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 LES model

-14.2 311.9
19.2 290.1
0.0 187.5
0.0 282.4
0.0 323.1
0.0 317.3
0.0 194.5
0.0 292.9
0.0 335.0
0.0 328.9

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 50.000

0.000
100.000
150.000
200.000
250.000
300.000
350.000
400.000
450.000
500.000

Dec-83

Jun-84

Dec-84

Jun-85

Dec-85

Jun-86

Dec-86

Jun-87

Dec-87

Jun-88

Dec-88

Jun-89

Dec-89

Jun-90

Dec-90

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Jun-91
Forecast--SA

Dec-91

Jun-92

Dec-92

Jun-93

Dec-93

Jun-94

Dec-94

Jun-95
LES forecast
Seasonally adjusted
 Forecast-NSA

600.0

500.0 Original series

Reseasonalized forecast

400.0

300.0

200.0

100.0

0.0
83 84 84 85 85 86 86 87 87 88 88 89 89 90 90 91 91 92 92 93 93 94 94 95
c- un- ec- un- ec- un- ec- un- ec- un- ec- un- ec- un- ec- un- ec- un- ec- un- ec- un- ec- un-
De J D J D J D J D J D J D J D J D J D J D J D J

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 0.0

-80.0
-60.0
-40.0
-20.0
20.0
40.0
60.0
80.0
Jun-84
Sep-84
Dec-84
Mar-85
Jun-85
Sep-85
Dec-85
Mar-86
Jun-86
Sep-86
Dec-86
Mar-87
Jun-87
Sep-87
Dec-87
Mar-88
Jun-88
Sep-88
Dec-88
Mar-89
Jun-89
Sep-89
Errors

Page 9
Errors (SA)

Dec-89
Mar-90
Jun-90
Sep-90
Dec-90
Mar-91
Jun-91
Sep-91
Dec-91
Mar-92
Jun-92
Sep-92
Dec-92
Mar-93
Jun-93
Sep-93
Errors (SA)
 ACF

Error Autocorrelations

1.00

0.80

0.60

0.40

0.20

0.00
1 2 3 4 5

-0.20

-0.40

-0.60

-0.80

-1.00

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