Can stock prices be predicted? (BATS Stock Forecast)

In the finance world stock trading is one of the most important activities. Stock market prediction is an act of trying to determine the future value of a stock other financial instrument traded on a financial exchange. This paper explains the prediction of a stock using Machine Learning. The technical and fundamental or the time series analysis is used by the most of the stockbrokers while making the stock predictions. We evaluate British American Tobacco prediction models with Modular Neural Network (DNN Layer) and Wilcoxon Sign-Rank Test1,2,3,4 and conclude that the BATS stock is predictable in the short/long term. According to price forecasts for (n+3 month) period: The dominant strategy among neural network is to Sell BATS stock.


Keywords: BATS, British American Tobacco, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. Investment Risk
  2. Which neural network is best for prediction?
  3. Market Outlook

BATS Target Price Prediction Modeling Methodology

In recent years there has been a significant growth of interest in the incorporation of historical series of variables related to stock prediction into mathematical models or computational algorithms in order to generate predictions or indications about expected price movements. We consider British American Tobacco Stock Decision Process with Wilcoxon Sign-Rank Test where A is the set of discrete actions of BATS 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(Wilcoxon Sign-Rank Test)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 (DNN Layer)) X S(n):→ (n+3 month) S = s 1 s 2 s 3

n:Time series to forecast

p:Price signals of BATS 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?

BATS Stock Forecast (Buy or Sell) for (n+3 month)

Sample Set: Neural Network
Stock/Index: BATS British American Tobacco
Time series to forecast n: 14 Oct 2022 for (n+3 month)

According to price forecasts for (n+3 month) period: The dominant strategy among neural network is to Sell BATS 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

British American Tobacco assigned short-term Ba2 & long-term Ba3 forecasted stock rating. We evaluate the prediction models Modular Neural Network (DNN Layer) with Wilcoxon Sign-Rank Test1,2,3,4 and conclude that the BATS stock is predictable in the short/long term. According to price forecasts for (n+3 month) period: The dominant strategy among neural network is to Sell BATS stock.

Financial State Forecast for BATS Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*Ba2Ba3
Operational Risk 8878
Market Risk8563
Technical Analysis4059
Fundamental Analysis5640
Risk Unsystematic6981

Prediction Confidence Score

Trust metric by Neural Network: 74 out of 100 with 775 signals.

References

  1. Y. Chow and M. Ghavamzadeh. Algorithms for CVaR optimization in MDPs. In Advances in Neural Infor- mation Processing Systems, pages 3509–3517, 2014.
  2. Angrist JD, Pischke JS. 2008. Mostly Harmless Econometrics: An Empiricist's Companion. Princeton, NJ: Princeton Univ. Press
  3. M. Benaim, J. Hofbauer, and S. Sorin. Stochastic approximations and differential inclusions, Part II: Appli- cations. Mathematics of Operations Research, 31(4):673–695, 2006
  4. M. J. Hausknecht. Cooperation and Communication in Multiagent Deep Reinforcement Learning. PhD thesis, The University of Texas at Austin, 2016
  5. N. B ̈auerle and A. Mundt. Dynamic mean-risk optimization in a binomial model. Mathematical Methods of Operations Research, 70(2):219–239, 2009.
  6. Zou H, Hastie T. 2005. Regularization and variable selection via the elastic net. J. R. Stat. Soc. B 67:301–20
  7. Athey S, Blei D, Donnelly R, Ruiz F. 2017b. Counterfactual inference for consumer choice across many prod- uct categories. AEA Pap. Proc. 108:64–67
Frequently Asked QuestionsQ: What is the prediction methodology for BATS stock?
A: BATS stock prediction methodology: We evaluate the prediction models Modular Neural Network (DNN Layer) and Wilcoxon Sign-Rank Test
Q: Is BATS stock a buy or sell?
A: The dominant strategy among neural network is to Sell BATS Stock.
Q: Is British American Tobacco stock a good investment?
A: The consensus rating for British American Tobacco is Sell and assigned short-term Ba2 & long-term Ba3 forecasted stock rating.
Q: What is the consensus rating of BATS stock?
A: The consensus rating for BATS is Sell.
Q: What is the prediction period for BATS stock?
A: The prediction period for BATS is (n+3 month)

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