Dow Stocks Analysis
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The daily Dow Jones Industrial Average increased 117.42 points from January 2, 2002 through April 12, 2002, or 1.2 percent, from 10,073.40 to 10,190.82. Using a factor of 0.3, exponential smoothing predicted an increase of 149.99 points, or an increase of 1.5 percent. The forecast figures predicted 10,073.40 to 10,223.39 (for the last data point which an actual figure exists due to the lag associated with exponential smoothing). The difference in the final day's closing for which there is both an actual and a forecast close is 32.57 points, or less than 0.3 percent. The largest daily error was 321.58 points (an error of 3 percent for the day while the smallest was 3.26 points, or 0.03 percent. The sum of the total errors is 181.70. As the graph illustrates, this results in an extremely close track between the actual and forecast data points for the daily close.Using a factor of 0.6, exponential smoothing is still fairly accurately at the daily level. The forecast figures predicted 10,073.40 to 10,248.72. The difference in the final day's closing for which there is both an actual and a forecast close is 57.90 points, or less than 0.5 percent. The sum of the total errors is 380.40, more than double the sum at .3. Although the .6 factor results in a close track between the actual and forecast data points, the largest variation between the actual and predicted data was 379.44 points (or 3.6 percent) while the smallest variation was only
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n increase from 2,293.62 to 9,808.42. The difference in the final quarter's closing for which there is both an actual and a forecast close is 519.92 points, or less than five percent (a better performance than the .3 level). The largest quarterly error was 1,909.99 points (an error of 17.5 percent for the quarter while the smallest was 11.09, or 0.04 percent. The sum of the total errors is 19,495.92. The performance overall at this level is slightly poorer than at the .3 factor, but the difference is less than at the daily level.
Quarterly Dow @ .9
Using a factor of 0.9, exponential smoothing predicted an increase of 6,953.46 points, or an increase of 303 percent. The forecast figures predicted an increase from 2,293.62 to 9,247.08. The difference in the final quarter's closing for which there is both an actual and a forecast close is 1,156.86 points, or more than 11 percent (significantly worse than either the .3 or .6 levels). The largest quarterly error was 4,006.37 points (an error of 36.5 percent for the quarter while the smallest was 13.01, or 0.5 percent. The sum of the total errors is 70,691.44. The performance overall at this level is considerably poorer than at the .3 or .6 factor, with far greater variation i
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Some common words found in the essay are:
Industrial Average, Annual Dow, Quarterly Dow, Daily Dow, predicted increase, actual forecast, exponential smoothing, actual forecast close, forecast figures predicted, closing actual forecast, sum total errors, closing actual, forecast figures, total errors, sum total, forecast close, difference final, figures predicted, percent sum total, Dow Jones, Jones Industrial,
Approximate Word count = 1304
Approximate Pages = 5 (250 words per page)
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