Differencing

Differencing is a method used to remove the trend and seasonality from a time series data. It involves computing the difference between consecutive observations in the series. This can be done once or multiple times until the series becomes stationary. Stationarity is important in time series analysis because it allows for the use of statistical models that assume constant mean and variance over time. Differencing can be performed on both seasonal and non-seasonal time series data. In seasonal differencing, the difference between observations from the same season in consecutive years is computed. Differencing is a common pre-processing step in time series analysis and is often used in forecasting and modeling.
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