Can stock prices be predicted? (CAC 40 Index Stock Forecast)

Abstract

We evaluate CAC 40 Index prediction models with Modular Neural Network (Market Direction Analysis) and Chi-Square^1,2,3,4 and conclude that the CAC 40 Index stock is predictable in the short/long term. According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Hold CAC 40 Index stock.

Keywords: CAC 40 Index, CAC 40 Index, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

1. Trading Signals
2. Trading Signals
3. Market Signals

CAC 40 Index Target Price Prediction Modeling Methodology

We consider CAC 40 Index Stock Decision Process with Chi-Square where A is the set of discrete actions of CAC 40 Index stock holders, F is the set of discrete states, P : S × F × S → R is the transition probability distribution, R : S × F → R is the reaction function, and γ ∈ [0, 1] is a move factor for expectation.^1,2,3,4

F(Chi-Square)^5,6,7= $\begin{array}{cccc}{p}_{\mathrm{a}1}& p_{\mathrm{a}2}& \dots & p_{1n}\\ & ⋮\\ p_{j1}& p_{j2}& \dots & p_{jn}\\ & ⋮\\ p_{k1}& p_{k2}& \dots & p_{kn}\\ & ⋮\\ p_{n1}& p_{n2}& \dots & p_{nn}\end{array}$ X R(Modular Neural Network (Market Direction Analysis)) X S(n):→ (n+6 month) $\overrightarrow{S}=\left(s_1,s_2,s_3\right)$

n:Time series to forecast

p:Price signals of CAC 40 Index stock

j:Nash equilibria

k:Dominated move

a:Best response for target price

 

For further technical information as per how our model work we invite you to visit the article below: 

How do AC Investment Research machine learning (predictive) algorithms actually work?

CAC 40 Index Stock Forecast (Buy or Sell) for (n+6 month)

Sample Set: Neural Network
Stock/Index: CAC 40 Index CAC 40 Index
Time series to forecast n: 05 Sep 2022 for (n+6 month)

According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Hold CAC 40 Index stock.

X axis: *Likelihood% (The higher the percentage value, the more likely the event will occur.)

Y axis: *Potential Impact% (The higher the percentage value, the more likely the price will deviate.)

Z axis (Yellow to Green): *Technical Analysis%

Conclusions

CAC 40 Index assigned short-term Ba3 & long-term B2 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Market Direction Analysis) with Chi-Square^1,2,3,4 and conclude that the CAC 40 Index stock is predictable in the short/long term. According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Hold CAC 40 Index stock.

Financial State Forecast for CAC 40 Index Stock Options & Futures

Rating	Short-Term	Long-Term Senior
Outlook*	Ba3	B2
Operational Risk	66	33
Market Risk	67	80
Technical Analysis	45	65
Fundamental Analysis	85	46
Risk Unsystematic	71	32

Prediction Confidence Score

Trust metric by Neural Network: 78 out of 100 with 455 signals.

References

1. R. Howard and J. Matheson. Risk sensitive Markov decision processes. Management Science, 18(7):356– 369, 1972
2. Athey S, Imbens GW. 2017b. The state of applied econometrics: causality and policy evaluation. J. Econ. Perspect. 31:3–32
3. Andrews, D. W. K. W. Ploberger (1994), "Optimal tests when a nuisance parameter is present only under the alternative," Econometrica, 62, 1383–1414.
4. Mullainathan S, Spiess J. 2017. Machine learning: an applied econometric approach. J. Econ. Perspect. 31:87–106
5. Matzkin RL. 1994. Restrictions of economic theory in nonparametric methods. In Handbook of Econometrics, Vol. 4, ed. R Engle, D McFadden, pp. 2523–58. Amsterdam: Elsevier
6. Cheung, Y. M.D. Chinn (1997), "Further investigation of the uncertain unit root in GNP," Journal of Business and Economic Statistics, 15, 68–73.
7. Mnih A, Kavukcuoglu K. 2013. Learning word embeddings efficiently with noise-contrastive estimation. In Advances in Neural Information Processing Systems, Vol. 26, ed. Z Ghahramani, M Welling, C Cortes, ND Lawrence, KQ Weinberger, pp. 2265–73. San Diego, CA: Neural Inf. Process. Syst. Found.

Frequently Asked Questions

Q: What is the prediction methodology for CAC 40 Index stock?
A: CAC 40 Index stock prediction methodology: We evaluate the prediction models Modular Neural Network (Market Direction Analysis) and Chi-Square
Q: Is CAC 40 Index stock a buy or sell?
A: The dominant strategy among neural network is to Hold CAC 40 Index Stock.
Q: Is CAC 40 Index stock a good investment?
A: The consensus rating for CAC 40 Index is Hold and assigned short-term Ba3 & long-term B2 forecasted stock rating.
Q: What is the consensus rating of CAC 40 Index stock?
A: The consensus rating for CAC 40 Index is Hold.
Q: What is the prediction period for CAC 40 Index stock?
A: The prediction period for CAC 40 Index is (n+6 month)

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