Monday, June 9, 2025

10 fun math tricks for predicting the future with forecasts

# Math Trick Description Use Case Example
1 Moving Averages Smooths data using a rolling average (SMA, WMA, EMA) Forecasting trends in sales or traffic
2 Exponential Smoothing Weights recent data more for responsive short-term forecasting Predicting next day's value
3 Linear Regression Fits a straight trend line to data Predicting future sales or prices
4 Polynomial Regression Fits a curve to account for nonlinear trends Modeling growth with acceleration
5 Logarithmic/Exponential Trend Fits curved models like exponential or logarithmic Forecasting growth or decay
6 Percent Change / Growth Rate Uses % increase/decrease to project future values Estimating next month's revenue
7 Seasonal Averaging Averages data by time periods (month, week, etc.) Forecasting monthly sales
8 Rolling Regression Applies linear regression over a sliding window Short-term stock price prediction
9 Z-Score Anomaly Detection Identifies and removes outliers using standard deviations Cleaning noisy time series
10 Fourier Transform (FFT) Finds cyclical patterns via frequency analysis Detecting seasonality in demand patterns

why not have another 10?

# Math Trick Description Use Case Example
11 CAGR (Compound Annual Growth Rate) Measures average annual growth rate over time Forecasting investment growth
12 Autoregressive (AR) Models Uses past values to predict the next one Time series forecasting like AR(1), AR(2)
13 Differencing (Δ) Subtracts previous values to remove trend or seasonality Stationarizing a time series
14 Cumulative Sum (CUSUM) Tracks cumulative change from a reference point Detecting slow shifts in process metrics
15 Holt-Winters (Triple Smoothing) Adds seasonality and trend to exponential smoothing Forecasting seasonally fluctuating data
16 Simple Lagged Features Adds previous values as new columns Enhancing model input with past behavior
17 Normalization/Standardization Scales data to make it comparable or Gaussian Preprocessing before regression or modeling
18 Clustering for Pattern Detection Groups similar trends using K-means or DBSCAN Discovering behavior groups in data
19 Savitzky–Golay Filter Smooths data while preserving shape Denoising noisy sensor or measurement data
20 Quantile Forecasting Predicts a range (not just average) using percentiles Risk modeling, demand estimation with bounds

10 more

# Math Trick Description Use Case Example
21 Slope Calculation (Rate of Change) Measures steepness between data points Detecting acceleration in trends
22 Cross-Correlation Measures similarity between two time series Lag detection between related variables
23 Seasonality Index Normalizes values by seasonal averages Adjusting for repeating seasonal patterns
24 Principal Component Analysis (PCA) Reduces dimensionality while preserving variance Feature compression before modeling
25 Residual Analysis Analyzes difference between actual and predicted values Improving model accuracy by modeling errors
26 Bootstrapping Resamples data with replacement to estimate confidence intervals Estimating forecast uncertainty
27 Time Series Decomposition Separates series into trend, seasonality, and residual Understanding data components for forecasting
28 Interpolation Fills in missing values between known data points Reconstructing incomplete datasets
29 Weighted Least Squares (WLS) Linear regression giving more weight to certain data points Handling heteroscedasticity in data
30 Bayesian Updating Updates forecast with new data based on prior beliefs Dynamic forecasting as new data arrives
# Math Trick Description Use Case Example
31 K-Nearest Neighbors (KNN) Forecasting Predicts based on the average of similar past patterns Forecasting similar behavior sequences
32 Dynamic Time Warping (DTW) Measures similarity between time series with time shifts Comparing sequences with misaligned timing
33 Prophet Model (by Facebook) Decomposable time series model with trend, seasonality, holidays Business forecasting with multiple components
34 Recurrent Patterns Detection Identifies repeating patterns in time series Analyzing periodic signals
35 Residual Smoothing Smooths the error component of a forecast Reducing noise in forecast residuals
36 Rolling Median Like moving average, but uses median for robustness to outliers Smoothing noisy data with outlier resistance
37 Data Binning Groups continuous values into categories Trend simplification or histogram generation
38 Signal Denoising (Wavelet Transform) Removes high-frequency noise while preserving structure Processing raw sensor or stock data
39 Granger Causality Test Determines if one time series can predict another Identifying causal predictors
40 Lead-Lag Analysis Measures which variables lead or follow others in time Input feature timing alignment
41 Change Point Detection Detects shifts in trend or distribution Finding when market behavior changes
42 Trend Strength Index Quantifies how strong the trend is Deciding if forecasting is appropriate
43 Signal-to-Noise Ratio (SNR) Compares signal strength to background noise Evaluating data quality for prediction
44 Elastic Net Regression Combines Lasso and Ridge for robust regression Forecasting with high-dimensional features
45 Lag Correlation Matrix Compares correlation across time lags Feature selection from past data
46 Time-Weighted Averages Weighs recent data more heavily based on time decay Real-time adaptive forecasting
47 Histogram-Based Forecasting Predicts based on distribution of past values Probabilistic forecasting from historical data
48 Rolling Standard Deviation Tracks volatility over time Measuring uncertainty or instability
49 Confidence Interval Forecasting Predicts with upper and lower bounds Risk-aware forecasting
50 Ensemble Averaging Combines forecasts from multiple models Improving accuracy through diversity

No comments:

Post a Comment