The video presents the single-parameter exponential smoothing update rule. The new forecast equals the prior forecast plus a fraction alpha of the prior forecast error, where the error is measured as actual minus forecast from the previous period.
Conditions: Used recursively over discrete time periods.; Requires a starting forecast value.; In the example, alpha is supplied as 0.2.
The video presents the single-parameter exponential smoothing update rule. The new forecast equals the prior forecast plus a fraction alpha of the prior forecast error, where the error is measured as actual minus forecast from the previous period.
Conditions: Used recursively over discrete time periods.; Requires a starting forecast value.; In the example, alpha is supplied as 0.2.