THE FORECASTlNG EDGE II is a menu-driven package which applies the sophisticated Box-Jenkins time-series forecasting method in an automated manner which is very easy to use, as well as surprisingly accurate. The analysis is particularly well-suited to data which a cyclical component, such as sales, the stock market, and similar seasonal processes.
THE FORECASTING EDGE II differs from DYNACOMP's other Box-Jenkins forecasting products in that it is aimed at the user having little technical knowledge of forecasting theory, and having no desire to be confused by the various associated statistical reports. The software is specially designed as an 'expert system' to automatically make most of the choices for the user, and to display the results in a simple, easy-to-understand graphical format.
The Box-Jenkins procedure is adaptive and is especially useful in situations in which regression or Fourier analysis is not practical or appropriate. For example, with regression (least-squares curve fitting), you need to know the functional form (equation) before starting. Once you know the form, the job is then to find the unknown coefficients. There are some products which try fitting to hundreds of equations and select the one which fits best. But what if the 'right' equation is not on the list, or, what if the functional form changes somewhere along the line?
Alternaltively, Fourier analysis techniques (such as DYNACOMP's FOURIER ANALYSIS FORECASTER) may be used to treat complicated situations having a multiplicity of superimposed cycles. In that Fourier analysis is superior to the normal Box-Jenkins method. However, all of the data are treated equally in determining the Fourier components; the weighting is equal. The Box-Jenkins approach, in effect, weights the most recent data more than distant data, and therefore is adaptive; it can deal with some shifting of the dependence as long as the period of the cycle does not change.
With THE FORECASTING EDGE II, data entry is easy and convenient, and there are many editing features. You may import to/from ASCII, 1-2-3, VisiCalc, dBASE, or WordStar data files. You may also enter data from the keyboard. When entering from the keyboard, two windows pop up. You enter data in the left-hand window, and a constantly updated graph is shown in the right-hand window.
To build a model, the software evaluates several possible formulas, and picks the best that matches the data. You may then select a range for projection, and it is plotted (or listed, printed, or saved to disk). The chosen confidence limits are also calculated and displayed. This gives you a statistical estimate (e.g., 99% confidence limit) of how good your projection is. This is exceptionally useful in evaluating the risk associated with possible sales losses due to understocking.
There are three model choices; simple, intermediate, and complex. They represent increasing levels of accuracy in calculation, and correspondingly take increasingly longer to process. The user does not need to know the mechanics of each model; only choose one.
The 'simple' option uses the method-of-moments technique with no diagnostics. The 'intermediate' option uses the method-of-moments technique, combined with a modified Marquardt algorithm. It also models the residuals and recalculates depending on whether or not the residuals are systematic.
The 'complex method' first does a Box-Cox transform, and then switches to the 'intermediate' method.
If you are technically oriented, you may use the 'explain' option to have the chosen model explained, including a display of the derived parameter values.
Several graphing options are available, including bar and line graphs, as well as line graphs with upper and lower limit confidence plots. You may compare graphs, set units, set the confidence level, change scale, select colors, add text anywhere to the plot, and so on. Graphs may be saved to disk (.PIC) and recalled at will.
The 156-page manual has the same emphasis as the software: ease-of-use. There is little discussion of theory (that can be found in text books). Instead, each option is described in detail, with examples.
Price: $99.95