Final answer:
A cash manager uses short-term forecasting for liquidity management and planning financial obligations, not for predicting stock market outcomes, which require analyzing more unpredictable and varied factors.
Step-by-step explanation:
A cash manager can use short-term forecasting to perform several functions but there are certain activities that are beyond its scope. Short-term forecasting can help in managing day-to-day cash flow, ensuring sufficient liquidity for operations, and planning for upcoming financial obligations. However, it cannot be used for predicting stock market outcomes. The reason is that the stock market is influenced by a wide array of unpredictable factors that go beyond the scope of a company's cash flows and liquidity requirements.
For instance, an economist creating a model to anticipate the stock market might produce a list of expected points on a stock market index for the forthcoming weeks, often based on a complex set of variables including economic data, market sentiment, and geopolitical events. At the end of each trading day, this economist would record the actual points on the index to gauge the accuracy of the forecasting model. Through this practice, the economist aims to refine the model for better accuracy; however, such activities are distinct from the cash manager's short-term forecasting duties.