ANGLO AMERICAN PLC Stock Forecast, Price & Rating (LON:AAL)

This paper proposes genetic algorithms (GAs) approach to feature discretization and the determination of connection weights for artificial neural networks (ANNs) to predict the stock price index. Previous research proposed many hybrid models of ANN and GA for the method of training the network, feature subset selection, and topology optimization. We evaluate ANGLO AMERICAN PLC prediction models with Deductive Inference (ML) and Ridge Regression1,2,3,4 and conclude that the LON:AAL stock is predictable in the short/long term. According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Hold LON:AAL stock.


Keywords: LON:AAL, ANGLO AMERICAN PLC, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. Stock Forecast Based On a Predictive Algorithm
  2. Stock Forecast Based On a Predictive Algorithm
  3. Nash Equilibria

LON:AAL Target Price Prediction Modeling Methodology

This study aims to predict the direction of stock prices by integrating time-varying effective transfer entropy (ETE) and various machine learning algorithms. At first, we explore that the ETE based on 3 and 6 months moving windows can be regarded as the market explanatory variable by analyzing the association between the financial crises and Granger-causal relationships among the stocks. We consider ANGLO AMERICAN PLC Stock Decision Process with Ridge Regression where A is the set of discrete actions of LON:AAL 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(Ridge 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(Deductive Inference (ML)) X S(n):→ (n+6 month) R = 1 0 0 0 1 0 0 0 1

n:Time series to forecast

p:Price signals of LON:AAL 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:AAL Stock Forecast (Buy or Sell) for (n+6 month)


Sample Set: Neural Network
Stock/Index: LON:AAL ANGLO AMERICAN PLC
Time series to forecast n: 11 Nov 2022 for (n+6 month)

According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Hold LON:AAL 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%

Adjusted IFRS* Prediction Methods for ANGLO AMERICAN PLC

  1. In some cases, the qualitative and non-statistical quantitative information available may be sufficient to determine that a financial instrument has met the criterion for the recognition of a loss allowance at an amount equal to lifetime expected credit losses. That is, the information does not need to flow through a statistical model or credit ratings process in order to determine whether there has been a significant increase in the credit risk of the financial instrument. In other cases, an entity may need to consider other information, including information from its statistical models or credit ratings processes.
  2. The assessment of whether an economic relationship exists includes an analysis of the possible behaviour of the hedging relationship during its term to ascertain whether it can be expected to meet the risk management objective. The mere existence of a statistical correlation between two variables does not, by itself, support a valid conclusion that an economic relationship exists.
  3. If an entity originates a loan that bears an off-market interest rate (eg 5 per cent when the market rate for similar loans is 8 per cent), and receives an upfront fee as compensation, the entity recognises the loan at its fair value, ie net of the fee it receives.
  4. The purpose of estimating expected credit losses is neither to estimate a worstcase scenario nor to estimate the best-case scenario. Instead, an estimate of expected credit losses shall always reflect the possibility that a credit loss occurs and the possibility that no credit loss occurs even if the most likely outcome is no credit loss.

*International Financial Reporting Standards (IFRS) are a set of accounting rules for the financial statements of public companies that are intended to make them consistent, transparent, and easily comparable around the world.

Conclusions

ANGLO AMERICAN PLC assigned short-term Ba3 & long-term B3 forecasted stock rating. We evaluate the prediction models Deductive Inference (ML) with Ridge Regression1,2,3,4 and conclude that the LON:AAL stock is predictable in the short/long term. According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Hold LON:AAL stock.

Financial State Forecast for LON:AAL ANGLO AMERICAN PLC Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*Ba3B3
Operational Risk 5362
Market Risk4955
Technical Analysis6538
Fundamental Analysis7939
Risk Unsystematic7047

Prediction Confidence Score

Trust metric by Neural Network: 89 out of 100 with 790 signals.

References

  1. J. Baxter and P. Bartlett. Infinite-horizon policy-gradient estimation. Journal of Artificial Intelligence Re- search, 15:319–350, 2001.
  2. Angrist JD, Pischke JS. 2008. Mostly Harmless Econometrics: An Empiricist's Companion. Princeton, NJ: Princeton Univ. Press
  3. Bastani H, Bayati M. 2015. Online decision-making with high-dimensional covariates. Work. Pap., Univ. Penn./ Stanford Grad. School Bus., Philadelphia/Stanford, CA
  4. Thomas P, Brunskill E. 2016. Data-efficient off-policy policy evaluation for reinforcement learning. In Pro- ceedings of the International Conference on Machine Learning, pp. 2139–48. La Jolla, CA: Int. Mach. Learn. Soc.
  5. R. Sutton, D. McAllester, S. Singh, and Y. Mansour. Policy gradient methods for reinforcement learning with function approximation. In Proceedings of Advances in Neural Information Processing Systems 12, pages 1057–1063, 2000
  6. Alexander, J. C. Jr. (1995), "Refining the degree of earnings surprise: A comparison of statistical and analysts' forecasts," Financial Review, 30, 469–506.
  7. Abadie A, Diamond A, Hainmueller J. 2015. Comparative politics and the synthetic control method. Am. J. Political Sci. 59:495–510
Frequently Asked QuestionsQ: What is the prediction methodology for LON:AAL stock?
A: LON:AAL stock prediction methodology: We evaluate the prediction models Deductive Inference (ML) and Ridge Regression
Q: Is LON:AAL stock a buy or sell?
A: The dominant strategy among neural network is to Hold LON:AAL Stock.
Q: Is ANGLO AMERICAN PLC stock a good investment?
A: The consensus rating for ANGLO AMERICAN PLC is Hold and assigned short-term Ba3 & long-term B3 forecasted stock rating.
Q: What is the consensus rating of LON:AAL stock?
A: The consensus rating for LON:AAL is Hold.
Q: What is the prediction period for LON:AAL stock?
A: The prediction period for LON:AAL is (n+6 month)

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