Modelling A.I. in Economics

Should You Buy Now or Wait? IBEX 35 Index Stock Forecast (Forecast)

This paper surveys machine learning techniques for stock market prediction. The prediction of stock markets is regarded as a challenging task of financial time series prediction. We evaluate IBEX 35 Index prediction models with Supervised Machine Learning (ML) and Statistical Hypothesis Testing1,2,3,4 and conclude that the IBEX 35 Index 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 Hold IBEX 35 Index stock.


Keywords: IBEX 35 Index, IBEX 35 Index, 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. Is it better to buy and sell or hold?
  3. What is neural prediction?

IBEX 35 Index Target Price Prediction Modeling Methodology

Stock market is considered chaotic, complex, volatile and dynamic. Undoubtedly, its prediction is one of the most challenging tasks in time series forecasting. Moreover existing Artificial Neural Network (ANN) approaches fail to provide encouraging results. Meanwhile advances in machine learning have presented favourable results for speech recognition, image classification and language processing. We consider IBEX 35 Index Stock Decision Process with Statistical Hypothesis Testing where A is the set of discrete actions of IBEX 35 Index 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(Supervised Machine Learning (ML)) X S(n):→ (n+3 month) R = 1 0 0 0 1 0 0 0 1

n:Time series to forecast

p:Price signals of IBEX 35 Index 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?

IBEX 35 Index Stock Forecast (Buy or Sell) for (n+3 month)

Sample Set: Neural Network
Stock/Index: IBEX 35 Index IBEX 35 Index
Time series to forecast n: 17 Oct 2022 for (n+3 month)

According to price forecasts for (n+3 month) period: The dominant strategy among neural network is to Hold IBEX 35 Index 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

IBEX 35 Index assigned short-term Ba3 & long-term B2 forecasted stock rating. We evaluate the prediction models Supervised Machine Learning (ML) with Statistical Hypothesis Testing1,2,3,4 and conclude that the IBEX 35 Index 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 Hold IBEX 35 Index stock.

Financial State Forecast for IBEX 35 Index Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*Ba3B2
Operational Risk 5436
Market Risk8652
Technical Analysis8756
Fundamental Analysis6448
Risk Unsystematic3281

Prediction Confidence Score

Trust metric by Neural Network: 90 out of 100 with 872 signals.

References

  1. Hartigan JA, Wong MA. 1979. Algorithm as 136: a k-means clustering algorithm. J. R. Stat. Soc. Ser. C 28:100–8
  2. C. Claus and C. Boutilier. The dynamics of reinforcement learning in cooperative multiagent systems. In Proceedings of the Fifteenth National Conference on Artificial Intelligence and Tenth Innovative Applications of Artificial Intelligence Conference, AAAI 98, IAAI 98, July 26-30, 1998, Madison, Wisconsin, USA., pages 746–752, 1998.
  3. Thompson WR. 1933. On the likelihood that one unknown probability exceeds another in view of the evidence of two samples. Biometrika 25:285–94
  4. J. Spall. Multivariate stochastic approximation using a simultaneous perturbation gradient approximation. IEEE Transactions on Automatic Control, 37(3):332–341, 1992.
  5. Tibshirani R. 1996. Regression shrinkage and selection via the lasso. J. R. Stat. Soc. B 58:267–88
  6. Dietterich TG. 2000. Ensemble methods in machine learning. In Multiple Classifier Systems: First International Workshop, Cagliari, Italy, June 21–23, pp. 1–15. Berlin: Springer
  7. Vilnis L, McCallum A. 2015. Word representations via Gaussian embedding. arXiv:1412.6623 [cs.CL]
Frequently Asked QuestionsQ: What is the prediction methodology for IBEX 35 Index stock?
A: IBEX 35 Index stock prediction methodology: We evaluate the prediction models Supervised Machine Learning (ML) and Statistical Hypothesis Testing
Q: Is IBEX 35 Index stock a buy or sell?
A: The dominant strategy among neural network is to Hold IBEX 35 Index Stock.
Q: Is IBEX 35 Index stock a good investment?
A: The consensus rating for IBEX 35 Index is Hold and assigned short-term Ba3 & long-term B2 forecasted stock rating.
Q: What is the consensus rating of IBEX 35 Index stock?
A: The consensus rating for IBEX 35 Index is Hold.
Q: What is the prediction period for IBEX 35 Index stock?
A: The prediction period for IBEX 35 Index is (n+3 month)

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