Modelling A.I. in Economics

What is SO stock prediction?

Abstract

We evaluate Southern Company prediction models with Modular Neural Network (News Feed Sentiment Analysis) and Statistical Hypothesis Testing1,2,3,4 and conclude that the SO 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 Hold SO stock.


Keywords: SO, Southern Company, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. Operational Risk
  2. What is the use of Markov decision process?
  3. Can neural networks predict stock market?

SO Target Price Prediction Modeling Methodology

We consider Southern Company Stock Decision Process with Statistical Hypothesis Testing where A is the set of discrete actions of SO 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(Statistical Hypothesis Testing)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(Modular Neural Network (News Feed Sentiment Analysis)) X S(n):→ (n+1 year) e x rx

n:Time series to forecast

p:Price signals of SO 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?

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

Sample Set: Neural Network
Stock/Index: SO Southern Company
Time series to forecast n: 06 Sep 2022 for (n+1 year)

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

Southern Company assigned short-term B1 & long-term B1 forecasted stock rating. We evaluate the prediction models Modular Neural Network (News Feed Sentiment Analysis) with Statistical Hypothesis Testing1,2,3,4 and conclude that the SO 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 Hold SO stock.

Financial State Forecast for SO Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*B1B1
Operational Risk 7161
Market Risk4666
Technical Analysis6130
Fundamental Analysis4364
Risk Unsystematic8273

Prediction Confidence Score

Trust metric by Neural Network: 89 out of 100 with 485 signals.

References

  1. V. Borkar. Q-learning for risk-sensitive control. Mathematics of Operations Research, 27:294–311, 2002.
  2. Hill JL. 2011. Bayesian nonparametric modeling for causal inference. J. Comput. Graph. Stat. 20:217–40
  3. Thomas P, Brunskill E. 2016. Data-efficient off-policy policy evaluation for reinforcement learning. In Pro- ceedings of the International Conference on Machine Learning, pp. 2139–48. La Jolla, CA: Int. Mach. Learn. Soc.
  4. Y. Le Tallec. Robust, risk-sensitive, and data-driven control of Markov decision processes. PhD thesis, Massachusetts Institute of Technology, 2007.
  5. Canova, F. B. E. Hansen (1995), "Are seasonal patterns constant over time? A test for seasonal stability," Journal of Business and Economic Statistics, 13, 237–252.
  6. S. Bhatnagar and K. Lakshmanan. An online actor-critic algorithm with function approximation for con- strained Markov decision processes. Journal of Optimization Theory and Applications, 153(3):688–708, 2012.
  7. M. J. Hausknecht and P. Stone. Deep recurrent Q-learning for partially observable MDPs. CoRR, abs/1507.06527, 2015
Frequently Asked QuestionsQ: What is the prediction methodology for SO stock?
A: SO stock prediction methodology: We evaluate the prediction models Modular Neural Network (News Feed Sentiment Analysis) and Statistical Hypothesis Testing
Q: Is SO stock a buy or sell?
A: The dominant strategy among neural network is to Hold SO Stock.
Q: Is Southern Company stock a good investment?
A: The consensus rating for Southern Company is Hold and assigned short-term B1 & long-term B1 forecasted stock rating.
Q: What is the consensus rating of SO stock?
A: The consensus rating for SO is Hold.
Q: What is the prediction period for SO stock?
A: The prediction period for SO is (n+1 year)

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