Modelling A.I. in Economics

Can stock prices be predicted? (LON:RSAB Stock Forecast) (Forecast)

In this paper, we propose a robust and novel hybrid model for prediction of stock returns. The proposed model is constituted of two linear models: autoregressive moving average model, exponential smoothing model and a non-linear model: recurrent neural network. Training data for recurrent neural network is generated by a new regression model. Recurrent neural network produces satisfactory predictions as compared to linear models. With the goal to further improve the accuracy of predictions, the proposed hybrid prediction model merges predictions obtained from these three prediction based models. We evaluate RSA INSURANCE GROUP LIMITED prediction models with Reinforcement Machine Learning (ML) and Beta1,2,3,4 and conclude that the LON:RSAB stock is predictable in the short/long term. According to price forecasts for (n+4 weeks) period: The dominant strategy among neural network is to Buy LON:RSAB stock.


Keywords: LON:RSAB, RSA INSURANCE GROUP LIMITED, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. Market Signals
  2. What is Markov decision process in reinforcement learning?
  3. Investment Risk

LON:RSAB Target Price Prediction Modeling Methodology

Stock market prediction is the act of trying to determine the future value of a company stock or other financial instrument traded on an exchange. The successful prediction of a stock's future price could yield significant profit. This paper will showcase how to perform stock prediction using Machine Learning algorithms. We consider RSA INSURANCE GROUP LIMITED Stock Decision Process with Beta where A is the set of discrete actions of LON:RSAB 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(Beta)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(Reinforcement Machine Learning (ML)) X S(n):→ (n+4 weeks) e x rx

n:Time series to forecast

p:Price signals of LON:RSAB 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?

LON:RSAB Stock Forecast (Buy or Sell) for (n+4 weeks)

Sample Set: Neural Network
Stock/Index: LON:RSAB RSA INSURANCE GROUP LIMITED
Time series to forecast n: 16 Oct 2022 for (n+4 weeks)

According to price forecasts for (n+4 weeks) period: The dominant strategy among neural network is to Buy LON:RSAB 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

RSA INSURANCE GROUP LIMITED assigned short-term B2 & long-term B2 forecasted stock rating. We evaluate the prediction models Reinforcement Machine Learning (ML) with Beta1,2,3,4 and conclude that the LON:RSAB stock is predictable in the short/long term. According to price forecasts for (n+4 weeks) period: The dominant strategy among neural network is to Buy LON:RSAB stock.

Financial State Forecast for LON:RSAB Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*B2B2
Operational Risk 4144
Market Risk3531
Technical Analysis8043
Fundamental Analysis8573
Risk Unsystematic3461

Prediction Confidence Score

Trust metric by Neural Network: 80 out of 100 with 509 signals.

References

  1. Bottomley, P. R. Fildes (1998), "The role of prices in models of innovation diffusion," Journal of Forecasting, 17, 539–555.
  2. Scott SL. 2010. A modern Bayesian look at the multi-armed bandit. Appl. Stoch. Models Bus. Ind. 26:639–58
  3. Y. Chow and M. Ghavamzadeh. Algorithms for CVaR optimization in MDPs. In Advances in Neural Infor- mation Processing Systems, pages 3509–3517, 2014.
  4. Breiman L. 2001a. Random forests. Mach. Learn. 45:5–32
  5. M. L. Littman. Friend-or-foe q-learning in general-sum games. In Proceedings of the Eighteenth International Conference on Machine Learning (ICML 2001), Williams College, Williamstown, MA, USA, June 28 - July 1, 2001, pages 322–328, 2001
  6. H. Kushner and G. Yin. Stochastic approximation algorithms and applications. Springer, 1997.
  7. Athey S, Imbens GW. 2017a. The econometrics of randomized experiments. In Handbook of Economic Field Experiments, Vol. 1, ed. E Duflo, A Banerjee, pp. 73–140. Amsterdam: Elsevier
Frequently Asked QuestionsQ: What is the prediction methodology for LON:RSAB stock?
A: LON:RSAB stock prediction methodology: We evaluate the prediction models Reinforcement Machine Learning (ML) and Beta
Q: Is LON:RSAB stock a buy or sell?
A: The dominant strategy among neural network is to Buy LON:RSAB Stock.
Q: Is RSA INSURANCE GROUP LIMITED stock a good investment?
A: The consensus rating for RSA INSURANCE GROUP LIMITED is Buy and assigned short-term B2 & long-term B2 forecasted stock rating.
Q: What is the consensus rating of LON:RSAB stock?
A: The consensus rating for LON:RSAB is Buy.
Q: What is the prediction period for LON:RSAB stock?
A: The prediction period for LON:RSAB is (n+4 weeks)

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