How Is Machine Learning Used in Trading? (ORA.PA Stock Forecast)

The main objective of this research is to predict the market performance on day closing using different machine learning techniques. The prediction model uses different attributes as an input and predicts market as Positive & Negative. We evaluate Orange prediction models with Modular Neural Network (DNN Layer) and ElasticNet Regression^1,2,3,4 and conclude that the ORA.PA 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 ORA.PA stock.

Keywords: ORA.PA, Orange, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

1. What is the use of Markov decision process?
2. Nash Equilibria
3. Market Risk

ORA.PA Target Price Prediction Modeling Methodology

The presented paper modeled and predicted stock returns using LSTM. The historical data of stock market were transformed into 30-days-long sequences with 10 learning features and 7-day earning rate labeling. The model was fitted by training on 1200000 sequences and tested using the other 350000 sequences. We consider Orange Stock Decision Process with ElasticNet Regression where A is the set of discrete actions of ORA.PA 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(ElasticNet Regression)^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 (DNN Layer)) X S(n):→ (n+1 year) $R=\left(\begin{array}{ccc}1& 0& 0\\ 0& 1& 0\\ 0& 0& 1\end{array}\right)$

n:Time series to forecast

p:Price signals of ORA.PA 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?

ORA.PA Stock Forecast (Buy or Sell) for (n+1 year)

Sample Set: Neural Network
Stock/Index: ORA.PA Orange
Time series to forecast n: 12 Oct 2022 for (n+1 year)

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

Orange assigned short-term B3 & long-term B1 forecasted stock rating. We evaluate the prediction models Modular Neural Network (DNN Layer) with ElasticNet Regression^1,2,3,4 and conclude that the ORA.PA 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 ORA.PA stock.

Financial State Forecast for ORA.PA Stock Options & Futures

Rating	Short-Term	Long-Term Senior
Outlook*	B3	B1
Operational Risk	84	83
Market Risk	48	64
Technical Analysis	34	30
Fundamental Analysis	45	36
Risk Unsystematic	43	64

Prediction Confidence Score

Trust metric by Neural Network: 81 out of 100 with 590 signals.

References

1. Bewley, R. M. Yang (1998), "On the size and power of system tests for cointegration," Review of Economics and Statistics, 80, 675–679.
2. Breiman L. 1993. Better subset selection using the non-negative garotte. Tech. Rep., Univ. Calif., Berkeley
3. M. Babes, E. M. de Cote, and M. L. Littman. Social reward shaping in the prisoner's dilemma. In 7th International Joint Conference on Autonomous Agents and Multiagent Systems (AAMAS 2008), Estoril, Portugal, May 12-16, 2008, Volume 3, pages 1389–1392, 2008.
4. M. Colby, T. Duchow-Pressley, J. J. Chung, and K. Tumer. Local approximation of difference evaluation functions. In Proceedings of the Fifteenth International Joint Conference on Autonomous Agents and Multiagent Systems, Singapore, May 2016
5. Belsley, D. A. (1988), "Modelling and forecast reliability," International Journal of Forecasting, 4, 427–447.
6. A. Eck, L. Soh, S. Devlin, and D. Kudenko. Potential-based reward shaping for finite horizon online POMDP planning. Autonomous Agents and Multi-Agent Systems, 30(3):403–445, 2016
7. Scott SL. 2010. A modern Bayesian look at the multi-armed bandit. Appl. Stoch. Models Bus. Ind. 26:639–58

Frequently Asked Questions

Q: What is the prediction methodology for ORA.PA stock?
A: ORA.PA stock prediction methodology: We evaluate the prediction models Modular Neural Network (DNN Layer) and ElasticNet Regression
Q: Is ORA.PA stock a buy or sell?
A: The dominant strategy among neural network is to Hold ORA.PA Stock.
Q: Is Orange stock a good investment?
A: The consensus rating for Orange is Hold and assigned short-term B3 & long-term B1 forecasted stock rating.
Q: What is the consensus rating of ORA.PA stock?
A: The consensus rating for ORA.PA is Hold.
Q: What is the prediction period for ORA.PA stock?
A: The prediction period for ORA.PA is (n+1 year)

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