Initial Value Problem - Exponential Smoothing

Exponential Smoothing

Exponential smoothing is a general method for removing noise from a data series, or producing a short term forecast of time series data.

Single exponential smoothing is equivalent to computing an exponential moving average. The smoothing parameter is determined automatically, by minimizing the squared difference between the actual and the forecast values. Double exponential smoothing introduces a linear trend, and so has two parameters. For estimating initial value there are several methods. like we use these two formulas;