What is Exponential Smoothing Or Exponential Moving Average (EMA)?

Exponential Smoothing Or Exponential Moving Average (EMA)


Exponential Smoothing Or Exponential Moving Average (EMA) procedure is a little different from the simple moving average procedure, as it assigns exponentially greater weights to more recent observations in the Time Series than old. This means recent observations are given relatively more weight in forecasting than the older observations in the Series.

In Moving Average, the weights assigned are constant (1/n) throughout the procedure while in the Exponential Smoothing Or Exponential Moving Average (EMA) , there are parameters to be estimated, which determines the weight to be assigned at a particular time in the Smoothing procedure.

Exponential Smoothing Or Exponential Moving Average (EMA) differ from simple moving averages in that today's EMA calculation depends on the EMA calculations for all other days prior to today

There are basically three types of Exponential Smoothing Or Exponential Moving Average (EMA) . Click on the topics to read more on Exponential Smoothing Or Exponential Moving Average (EMA). 




🚏  Click Here To Get The Introduction To Moving Average.
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