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Bayesian forecast combination using time-varying features

Li Li, Yanfei Kang, Feng Li

arXiv 4 Aug 2021 · Econometrics · publishedInternational Journal of Forecasting (2022) · 24 citations (OpenAlex)

arXiv:2108.02082 · PDF · DOI · OpenAlex · Extracted main text

Abstract

In this work, we propose a novel framework for density forecast combination by constructing time-varying weights based on time series features, which is called Feature-based Bayesian Forecasting Model Averaging (FEBAMA). Our framework estimates weights in the forecast combination via Bayesian log predictive scores, in which the optimal forecasting combination is determined by time series features from historical information. In particular, we use an automatic Bayesian variable selection method to add weight to the importance of different features. To this end, our approach has better interpretability compared to other black-box forecasting combination schemes. We apply our framework to stock market data and M3 competition data. Based on our structure, a simple maximum-a-posteriori scheme outperforms benchmark methods, and Bayesian variable selection can further enhance the accuracy for both point and density forecasts.

Citation extraction

67
references
123
in-text mentions
67
distinct cited
8
self-citations
9,650
main-text words

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Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
1Geweke, John, Amisano, Gianni (2011) Optimal Prediction Pools1.000185100%
2Kapetanios, G, Mitchell, James, Price, Simon, Fawcett, Nicholas (2015) Generalised density forecast combinations1.000114100%
3Monteromanso, Pablo, Athanasopoulos, George, Hyndman, Rob J, Talagal… (2020) FFORMA: Feature-based forecast model averaging1.00075100%
4Talagala, Thiyanga S, Li, Feng, Kang, Yanfei (2022) FFORMPP: Feature-based forecast model performance prediction self0.92844100%
5Hyndman, Rob, Kang, Yanfei, Montero-Manso, Pablo, Talagala, Thiyanga… (2020) tsfeatures: Time Series feature extraction self0.84333100%
6Kang, Yanfei, Hyndman, Rob J, Li, Feng (2020) GRATIS: GeneRAting TIme Series with diverse and controllable characteristics self0.84333100%
7Kononenko, Igor (1994) Estimating attributes: Analysis and extensions of RELIEF0.84333100%
8Del Negro, Marco, Hasegawa, Raiden B, Schorfheide, Frank (2016) Dynamic prediction pools: An investigation of financial frictions and forecasting performance0.73732100%
9Hall, Stephen G, Mitchell, James (2007) Combining density forecasts0.64441100%
10Harvey, David, Leybourne, Stephen, Newbold, Paul (1997) Testing the equality of prediction mean squared errors0.64422100%

Showing the top 10 of 67 scored citations.

Cited by, within the corpus

arXiv econ.EM papers that cite this one, ranked by how heavily they lean on it.

Citing paperIntensityMentionsSections
1Feature-based intermittent demand forecast combinations: accuracy and inventory implications0.40511
2Predictive Density Combination Using a Tree-Based Synthesis Function0.40511