Basics of time series analysis#

A Time Series is a data series indexed by time. In the realm of Finance, a time series records the fluctuations of specific data points, such as the price of a security, over a defined duration with data recorded at consistent intervals.

What is its purpose?#

Time series analysis serves to observe the evolution of a particular asset, security, or economic metric over time. Additionally, it enables comparison of these changes with fluctuations in other variables during the same timeframe.

For instance, consider analyzing a time series of daily closing stock prices for a particular stock spanning a year. This entails compiling a chronological list of all daily closing prices for the stock over the past year.