29.20. Length of series. A series that is under three years in length cannot be seasonally adjusted accurately with either TRAMO-SEATS or X-12-ARIMA. It is possible, however, to adjust these series using alternative, less standard, procedures. For series that are long enough to run X-12-ARIMA or TRAMO-SEATS but remain quite short (three to seven years), some instability problems can araise. Several empirical comparisons have been carried out to assess the relative performance of X-12-ARIMA and of TRAMO-SEATS on short time-series.
29.21. Seasonal adjustment of shorter series. It is good practice to evaluate the results of seasonally adjusting shorter series over an extended period before deciding whether to publish them or not. For instance, it is important to check for consistency and reliability for each period (monthly or quarterly). As a general rule, when the series are shorter than seven years, the specification of the parameters used for pretreatment and seasonal adjustment has to be checked more often (e.g., twice a year in order to deal with the higher degree of instability of such series).
29.22. Series requiring non-standard seasonal adjustment. Some series can be characterized by highly specific features which preclude the application of standard seasonal adjustment methods. Such features include high non-linearity[3], absence of a clear signal due to a dominant irregular component, unstable seasonality, a high number of outliers, and heteroskedasticity.[4] In such cases, ad hoc treatment should be carried out.
[3] Non-linearity refers to a model whose variables are not written as a linear difference equation.
[4] Heteroskedasticity occurs in a linear model with error terms that do not have constant variance.