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Kalman Filter / Local Level Explorer

ECON-5371 · Time Series Analysis and Forecasting — Chapter 11 companion widget

Local Level Model

yt = μt + εt    μt = μt−1 + ηt
Noise Variances
Signal-to-Noise Ratio
q = σ²η / σ²ε
0.125
Steady-state Kalman gain
Display
Filtered vs. Smoothed Trend Estimates
Observed y(t) True trend μ(t) Filtered μ̂(t|t) Smoothed μ̂(t|T)
Kalman Gain K(t) Over Time