BIR FINANCIAL LIMITED Research Report

## Summary

Neural networks, as an intelligent data mining method, have been used in many different challenging pattern recognition problems such as stock market prediction. However, there is no formal method to determine the optimal neural network for prediction purpose in the literature. In this paper, two kinds of neural networks, a feed forward multi layer Perceptron (MLP) and an Elman recurrent network, are used to predict a company's stock value based on its stock share value history. We evaluate BIR FINANCIAL LIMITED prediction models with Reinforcement Machine Learning (ML) and Sign Test1,2,3,4 and conclude that the BIR 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 BIR stock.

## Key Points

1. Technical Analysis with Algorithmic Trading
2. Probability Distribution

## BIR Target Price Prediction Modeling Methodology

We consider BIR FINANCIAL LIMITED Stock Decision Process with Reinforcement Machine Learning (ML) where A is the set of discrete actions of BIR 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(Sign Test)5,6,7= $\begin{array}{cccc}{p}_{a1}& {p}_{a2}& \dots & {p}_{1n}\\ & ⋮\\ {p}_{j1}& {p}_{j2}& \dots & {p}_{jn}\\ & ⋮\\ {p}_{k1}& {p}_{k2}& \dots & {p}_{kn}\\ & ⋮\\ {p}_{n1}& {p}_{n2}& \dots & {p}_{nn}\end{array}$ X R(Reinforcement Machine Learning (ML)) X S(n):→ (n+4 weeks) $R=\left(\begin{array}{ccc}1& 0& 0\\ 0& 1& 0\\ 0& 0& 1\end{array}\right)$

n:Time series to forecast

p:Price signals of BIR stock

j:Nash equilibria (Neural Network)

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?

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

Sample Set: Neural Network
Stock/Index: BIR BIR FINANCIAL LIMITED
Time series to forecast n: 27 Nov 2022 for (n+4 weeks)

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

1. Conversely, if the critical terms of the hedging instrument and the hedged item are not closely aligned, there is an increased level of uncertainty about the extent of offset. Consequently, the hedge effectiveness during the term of the hedging relationship is more difficult to predict. In such a situation it might only be possible for an entity to conclude on the basis of a quantitative assessment that an economic relationship exists between the hedged item and the hedging instrument (see paragraphs B6.4.4–B6.4.6). In some situations a quantitative assessment might also be needed to assess whether the hedge ratio used for designating the hedging relationship meets the hedge effectiveness requirements (see paragraphs B6.4.9–B6.4.11). An entity can use the same or different methods for those two different purposes.
2. Because the hedge accounting model is based on a general notion of offset between gains and losses on the hedging instrument and the hedged item, hedge effectiveness is determined not only by the economic relationship between those items (ie the changes in their underlyings) but also by the effect of credit risk on the value of both the hedging instrument and the hedged item. The effect of credit risk means that even if there is an economic relationship between the hedging instrument and the hedged item, the level of offset might become erratic. This can result from a change in the credit risk of either the hedging instrument or the hedged item that is of such a magnitude that the credit risk dominates the value changes that result from the economic relationship (ie the effect of the changes in the underlyings). A level of magnitude that gives rise to dominance is one that would result in the loss (or gain) from credit risk frustrating the effect of changes in the underlyings on the value of the hedging instrument or the hedged item, even if those changes were significant.
3. For example, an entity may use this condition to designate financial liabilities as at fair value through profit or loss if it meets the principle in paragraph 4.2.2(b) and the entity has financial assets and financial liabilities that share one or more risks and those risks are managed and evaluated on a fair value basis in accordance with a documented policy of asset and liability management. An example could be an entity that has issued 'structured products' containing multiple embedded derivatives and manages the resulting risks on a fair value basis using a mix of derivative and non-derivative financial instruments
4. An entity can rebut this presumption. However, it can do so only when it has reasonable and supportable information available that demonstrates that even if contractual payments become more than 30 days past due, this does not represent a significant increase in the credit risk of a financial instrument. For example when non-payment was an administrative oversight, instead of resulting from financial difficulty of the borrower, or the entity has access to historical evidence that demonstrates that there is no correlation between significant increases in the risk of a default occurring and financial assets on which payments are more than 30 days past due, but that evidence does identify such a correlation when payments are more than 60 days past due.

*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

BIR FINANCIAL LIMITED assigned short-term Ba2 & long-term Ba1 forecasted stock rating. We evaluate the prediction models Reinforcement Machine Learning (ML) with Sign Test1,2,3,4 and conclude that the BIR 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 BIR stock.

### Financial State Forecast for BIR BIR FINANCIAL LIMITED Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*Ba2Ba1
Operational Risk 5189
Market Risk5763
Technical Analysis7745
Fundamental Analysis6481
Risk Unsystematic8973

### Prediction Confidence Score

Trust metric by Neural Network: 93 out of 100 with 662 signals.

## References

1. Swaminathan A, Joachims T. 2015. Batch learning from logged bandit feedback through counterfactual risk minimization. J. Mach. Learn. Res. 16:1731–55
2. Thompson WR. 1933. On the likelihood that one unknown probability exceeds another in view of the evidence of two samples. Biometrika 25:285–94
3. Dudik M, Langford J, Li L. 2011. Doubly robust policy evaluation and learning. In Proceedings of the 28th International Conference on Machine Learning, pp. 1097–104. La Jolla, CA: Int. Mach. Learn. Soc.
4. Van der Vaart AW. 2000. Asymptotic Statistics. Cambridge, UK: Cambridge Univ. Press
5. Wu X, Kumar V, Quinlan JR, Ghosh J, Yang Q, et al. 2008. Top 10 algorithms in data mining. Knowl. Inform. Syst. 14:1–37
6. Künzel S, Sekhon J, Bickel P, Yu B. 2017. Meta-learners for estimating heterogeneous treatment effects using machine learning. arXiv:1706.03461 [math.ST]
7. A. K. Agogino and K. Tumer. Analyzing and visualizing multiagent rewards in dynamic and stochastic environments. Journal of Autonomous Agents and Multi-Agent Systems, 17(2):320–338, 2008
Frequently Asked QuestionsQ: What is the prediction methodology for BIR stock?
A: BIR stock prediction methodology: We evaluate the prediction models Reinforcement Machine Learning (ML) and Sign Test
Q: Is BIR stock a buy or sell?
A: The dominant strategy among neural network is to Hold BIR Stock.
Q: Is BIR FINANCIAL LIMITED stock a good investment?
A: The consensus rating for BIR FINANCIAL LIMITED is Hold and assigned short-term Ba2 & long-term Ba1 forecasted stock rating.
Q: What is the consensus rating of BIR stock?
A: The consensus rating for BIR is Hold.
Q: What is the prediction period for BIR stock?
A: The prediction period for BIR is (n+4 weeks)