Lagging Performance Indicator

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A Lagging Performance Indicator is an performance indicator measure that belatedly reflects changes in performance.



References

2018

  • https://www.investopedia.com/terms/l/laggingindicator.asp
    • QUOTE: A lagging indicator is a measurable economic factor that changes only after the economy has begun to follow a particular pattern or trend. It is often a technical indicator that trails the price action of an underlying asset, and traders use it to generate transaction signals or confirm the strength of a given trend. Since these indicators lag the price of the asset, a significant move in the market generally occurs before the indicator can provide a signal.

      A lagging indicator is a financial sign that becomes apparent only after a large economic shift has taken place. Therefore, lagging indicators confirm long-term trends, but they do not predict them. Some general examples of lagging indicators include the unemployment rate, corporate profits and labor cost per unit of output. Interest rates are another good lagging indicator, since rates change as a reaction to severe movements in the market. Other lagging indicators are economic measurements, such as gross domestic product (GDP), the consumer price index (CPI) and the balance of trade. These indicators differ from leading indicators, such as retail sales and the stock market, which are used to forecast and make predictions.