6.2 Methods of decomposing

There are three approaches to decomposing (probably more).

1. Decomposing, with the following approach:
   1. Deseasonalizing using seasonal dummies
   2. Detrending using a trend variable, see example in 5.1.3.5
2. Decomposing with the following (see example 6.5.5 and then look under option 2):
   1. Deseasonalizing using MA (moving averages not ARMA). Where you apply the season, e.g., quarterly, then 4 periods b.Detrending using a trend variable, see example in 5.1.3.5
3. Using decompose() a. Note: this use moving averages, see the documentation

See some good examples in the following:

• Using decomposition, with trend and seasonality 6.5.1
• Using CMA + CMAT to identify cycles 6.5.2