# Knowledge Base & Community Wiki

## Time Series Decomposition

**What is Time Series Decomposition** – Decomposition procedures are used in time series to describe the trend and seasonal factors in a time series. More extensive decomposition’s might also include long-run cycles, holiday effects, and day of week effects, so on. Time Series Decomposition in VisualizeIT breaks down the original Time Series into its trend and seasonal decomposition.

One of the main objectives for a decomposition is to estimate seasonal effects that can be used to create and present seasonally adjusted values. A seasonally adjusted value removes the seasonal effect from a value so that trends can be seen more clearly. For example, in many regions of the U.S. unemployment tends to decrease in the summer due to increased employment in agricultural areas. Thus a drop in the unemployment rate in June compared to May doesn’t necessarily indicate that there’s a trend toward lower unemployment in the country. To see whether there is a real trend, we should adjust for the fact that unemployment is always lower in June than in May.

The following two structures are considered for basic decomposition models:

- Additive: Xt = Trend + Seasonal + Residual
- Multiplicative: Xt = Trend * Seasonal * Residual

The “Residual” term is often called “Irregular” in decompositions.

The Time Series Decomposition capability within VisualizeIT allows you Decompose data for a given Application / Data Dimension into the following components –

- Trend
- Seasonality
- Residue

The Time Series Decomposition capability within VisualizeIT should be used to understand the Trends and Seasonality within your data. We would encourage use of the Time Series Decomposition capability to decompose the data into Trends, Seasonality and Residue once you’ve have used Time Series EDA (Exploratory Data Analysis) to slice, dice your data and understand the data sets key characteristics.

**Modelling Solution:** VisualizeIT offers access to a bunch of Analytical Models, Statistical Models and Simulation Models for purposes of Visualization, Modelling & Forecasting. Access to all the Analytical (Mathematical) models is free. We recommend you try out the Analytical models at VisualizeIT which are free to use and drop us a note with your suggestions, input and comments. You can access the VisualizeIT website here and the VisualizeIT modelling solution here –VisualizeIT.