Seasonal tendencies

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Seasonal tendencies describes the process by which time series data follow regular patterns that correspond to particular times of the year.

In finance, price data often follows a seasonal pattern because the supply of or demand for an item is not constant throughout the year; this is a type of calendar effect. For example, natural gas prices often rise in the winter because of a surge in demand for that commodity to heat homes. In the summer, when home heating demand is not present, prices are typically lower. Seasonal patterns are not confined to prices--many other variables can exhibit the patterns.