Determining whether a Time series is white noise

Question

I have a time series of log-returns of a stock. I want to determine whether the time series is just white noise or if there are some other pattern. How to I use the definition of white noise to make a conclusion?

Can you add a graph of what your time series currently looks like, and its ACF? — Jon, Nov 01 '17 at 19:56
anyway, financial time series implies "some other pattern" ,all the time. — tagoma, Nov 01 '17 at 20:11

score 7 · Answer 1 · answered Nov 01 '17 at 19:52

You want to look at an autocorrelation function (ACF) plot. If no lags are significantly correlated, then you basically have white noise or a MA(q) process aka moving average.

You can use this guide here to compare what your ACF plot looks like to determine if your time-series is "white noise" or not. Guide to ACF/PACF Plots

Also, feel free to browse through previous time-series related posts like:

Determining whether a Time series is white noise

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