Modelling A.I. in Economics

Can we predict stock market using machine learning? (TGT Stock Forecast) (Forecast)

Abstract

We evaluate Target Corporation prediction models with Transductive Learning (ML) and Ridge Regression1,2,3,4 and conclude that the TGT stock is predictable in the short/long term. According to price forecasts for (n+1 year) period: The dominant strategy among neural network is to Sell TGT stock.


Keywords: TGT, Target Corporation, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. How do you know when a stock will go up or down?
  2. Operational Risk
  3. Why do we need predictive models?

TGT Target Price Prediction Modeling Methodology

We consider Target Corporation Stock Decision Process with Ridge Regression where A is the set of discrete actions of TGT 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(Ridge Regression)5,6,7= p a 1 p a 2 p 1 n p j 1 p j 2 p j n p k 1 p k 2 p k n p n 1 p n 2 p n n X R(Transductive Learning (ML)) X S(n):→ (n+1 year) i = 1 n a i

n:Time series to forecast

p:Price signals of TGT 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?

TGT Stock Forecast (Buy or Sell) for (n+1 year)

Sample Set: Neural Network
Stock/Index: TGT Target Corporation
Time series to forecast n: 01 Sep 2022 for (n+1 year)

According to price forecasts for (n+1 year) period: The dominant strategy among neural network is to Sell TGT 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

Target Corporation assigned short-term Baa2 & long-term Ba1 forecasted stock rating. We evaluate the prediction models Transductive Learning (ML) with Ridge Regression1,2,3,4 and conclude that the TGT stock is predictable in the short/long term. According to price forecasts for (n+1 year) period: The dominant strategy among neural network is to Sell TGT stock.

Financial State Forecast for TGT Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*Baa2Ba1
Operational Risk 8053
Market Risk8484
Technical Analysis6377
Fundamental Analysis8175
Risk Unsystematic8366

Prediction Confidence Score

Trust metric by Neural Network: 85 out of 100 with 816 signals.

References

  1. F. A. Oliehoek, M. T. J. Spaan, and N. A. Vlassis. Optimal and approximate q-value functions for decentralized pomdps. J. Artif. Intell. Res. (JAIR), 32:289–353, 2008
  2. F. A. Oliehoek and C. Amato. A Concise Introduction to Decentralized POMDPs. SpringerBriefs in Intelligent Systems. Springer, 2016
  3. S. Bhatnagar, R. Sutton, M. Ghavamzadeh, and M. Lee. Natural actor-critic algorithms. Automatica, 45(11): 2471–2482, 2009
  4. Abadie A, Diamond A, Hainmueller J. 2015. Comparative politics and the synthetic control method. Am. J. Political Sci. 59:495–510
  5. Sutton RS, Barto AG. 1998. Reinforcement Learning: An Introduction. Cambridge, MA: MIT Press
  6. Z. Wang, T. Schaul, M. Hessel, H. van Hasselt, M. Lanctot, and N. de Freitas. Dueling network architectures for deep reinforcement learning. In Proceedings of the International Conference on Machine Learning (ICML), pages 1995–2003, 2016.
  7. Artis, M. J. W. Zhang (1990), "BVAR forecasts for the G-7," International Journal of Forecasting, 6, 349–362.
Frequently Asked QuestionsQ: What is the prediction methodology for TGT stock?
A: TGT stock prediction methodology: We evaluate the prediction models Transductive Learning (ML) and Ridge Regression
Q: Is TGT stock a buy or sell?
A: The dominant strategy among neural network is to Sell TGT Stock.
Q: Is Target Corporation stock a good investment?
A: The consensus rating for Target Corporation is Sell and assigned short-term Baa2 & long-term Ba1 forecasted stock rating.
Q: What is the consensus rating of TGT stock?
A: The consensus rating for TGT is Sell.
Q: What is the prediction period for TGT stock?
A: The prediction period for TGT is (n+1 year)

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