Seasonal Index -

[ \textAdjusted Index_i = \frac\textRaw Index_i\textMean of Raw Indices ]

After dividing actual by the seasonal index, you get , which reveals the true trend and cycle. seasonal index

= Actual ÷ Seasonal Index.

[ \textActual = \textTrend \times \textSeasonal \times \textIrregular ] Group all ratios by month (or quarter, etc

This ratio represents the combined effect of seasonality and random noise. Group all ratios by month (or quarter, etc.) and calculate the median or mean (median is less sensitive to outliers). Step 4: Adjust So That Average = 1 If the average of your raw seasonal indices is not exactly 1, adjust them: A seasonal index (also called a seasonal component

1. What Is a Seasonal Index? A seasonal index (also called a seasonal component or seasonal factor) is a numerical value that quantifies how a particular time period (e.g., a month, quarter, or week) compares to the average period in a seasonal cycle. It is used to measure and remove seasonal variation – predictable, recurring fluctuations that happen within a fixed period (usually one year).

[ \textSeasonal Ratio = \frac\textActual Value\textCentered Moving Average ]