Modelling A.I. in Economics

When should you buy or sell a stock? (LRCX Stock Forecast) (Forecast)

Nowadays, people show more and more enthusiasm for applying machine learning methods to finance domain. Many scholars and investors are trying to discover the mystery behind the stock market by applying deep learning. This thesis compares four machine learning methods: long short-term memory (LSTM), gated recurrent units (GRU), support vector machine (SVM), and eXtreme gradient boosting (XGBoost) to test which one performs the best in predicting the stock trend. We evaluate Lam Research prediction models with Modular Neural Network (Market Volatility Analysis) and Logistic Regression1,2,3,4 and conclude that the LRCX 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 Hold LRCX stock.


Keywords: LRCX, Lam Research, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. Can machine learning predict?
  2. What are main components of Markov decision process?
  3. Is Target price a good indicator?

LRCX Target Price Prediction Modeling Methodology

One decision in Stock Market can make huge impact on an investor's life. The stock market is a complex system and often covered in mystery, it is therefore, very difficult to analyze all the impacting factors before making a decision. In this research, we have tried to design a stock market prediction model which is based on different factors. We consider Lam Research Stock Decision Process with Logistic Regression where A is the set of discrete actions of LRCX 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(Logistic Regression)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 (Market Volatility Analysis)) X S(n):→ (n+4 weeks) r s rs

n:Time series to forecast

p:Price signals of LRCX 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?

LRCX Stock Forecast (Buy or Sell) for (n+4 weeks)

Sample Set: Neural Network
Stock/Index: LRCX Lam Research
Time series to forecast n: 04 Oct 2022 for (n+4 weeks)

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

Lam Research assigned short-term Caa2 & long-term Ba3 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Market Volatility Analysis) with Logistic Regression1,2,3,4 and conclude that the LRCX 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 Hold LRCX stock.

Financial State Forecast for LRCX Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*Caa2Ba3
Operational Risk 7937
Market Risk3182
Technical Analysis5256
Fundamental Analysis3375
Risk Unsystematic3365

Prediction Confidence Score

Trust metric by Neural Network: 93 out of 100 with 737 signals.

References

  1. J. Baxter and P. Bartlett. Infinite-horizon policy-gradient estimation. Journal of Artificial Intelligence Re- search, 15:319–350, 2001.
  2. Andrews, D. W. K. W. Ploberger (1994), "Optimal tests when a nuisance parameter is present only under the alternative," Econometrica, 62, 1383–1414.
  3. Bamler R, Mandt S. 2017. Dynamic word embeddings via skip-gram filtering. In Proceedings of the 34th Inter- national Conference on Machine Learning, pp. 380–89. La Jolla, CA: Int. Mach. Learn. Soc.
  4. Breiman L, Friedman J, Stone CJ, Olshen RA. 1984. Classification and Regression Trees. Boca Raton, FL: CRC Press
  5. Efron B, Hastie T, Johnstone I, Tibshirani R. 2004. Least angle regression. Ann. Stat. 32:407–99
  6. Angrist JD, Pischke JS. 2008. Mostly Harmless Econometrics: An Empiricist's Companion. Princeton, NJ: Princeton Univ. Press
  7. Clements, M. P. D. F. Hendry (1997), "An empirical study of seasonal unit roots in forecasting," International Journal of Forecasting, 13, 341–355.
Frequently Asked QuestionsQ: What is the prediction methodology for LRCX stock?
A: LRCX stock prediction methodology: We evaluate the prediction models Modular Neural Network (Market Volatility Analysis) and Logistic Regression
Q: Is LRCX stock a buy or sell?
A: The dominant strategy among neural network is to Hold LRCX Stock.
Q: Is Lam Research stock a good investment?
A: The consensus rating for Lam Research is Hold and assigned short-term Caa2 & long-term Ba3 forecasted stock rating.
Q: What is the consensus rating of LRCX stock?
A: The consensus rating for LRCX is Hold.
Q: What is the prediction period for LRCX stock?
A: The prediction period for LRCX is (n+4 weeks)

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