Holt Linear

This forecasting method is an extension of Simple Exponential Smoothing (See Simple Exponential Smoothing) that adds the ability to capture the trend of the time series. This method is commonly referred to as Double Exponential Smoothing because it uses an additional smoothing factor beta in order to handle the influence of the overall trend. The method is broken into two variations, Additive and Multiplicative.

NOTE: Holt-Linear Models are capable of handling data with a trend component but not seasonal components.

Holt-Linear Additive

In this variation, the smoothing factor beta is expressed in absolute terms in the scale of the observed series. The additive method is preferred when the seasonal variations are changing proportionally to the level of the series.

Holt-Linear Multiplicative

In this variation, the smoothing factor beta is expressed in relative terms or as a percentage. The multiplicative method is preferred when the seasonal variations are changing disproportionally to the level of the series.