You can predict future values, revenues, expenses, costs, trends, and other related indicators using one of four main forecasting techniques.
A straight-line approach
The forecasting technique that is the simplest to understand and apply is this one. Financial analysts frequently use it to forecast future sales based on historical trends and data.
Average movement
This method examines a dataset’s underlying pattern to predict future values. The three-month and five-month moving averages are the two that are most frequently utilised.
Straight-line regression
It is particularly helpful when examining the relationship between various variables to obtain a more precise prediction.
A number of linear regressions
It is mainly used for forecasting revenues, in situations where two or more independent variables are needed for a projection.
