Buy, sell or hold: S&P/BMV IPC Index Stock Forecast

Neural networks (NNs), as artificial intelligence (AI) methods, have become very important in making stock market predictions. Much research on the applications of NNs for solving business problems have proven their advantages over statistical and other methods that do not include AI, although there is no optimal methodology for a certain problem. We evaluate S&P/BMV IPC Index prediction models with Active Learning (ML) and Paired T-Test1,2,3,4 and conclude that the S&P/BMV IPC Index 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 S&P/BMV IPC Index stock.


Keywords: S&P/BMV IPC Index, S&P/BMV IPC Index, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. Trading Interaction
  2. Can we predict stock market using machine learning?
  3. Reaction Function

S&P/BMV IPC Index Target Price Prediction Modeling Methodology

Market systems are so complex that they overwhelm the ability of any individual to predict. But it is crucial for the investors to predict stock market price to generate notable profit. We have taken into factors such as Commodity Prices (crude oil, gold, silver), Market History, and Foreign exchange rate (FEX) that influence the stock trend. We consider S&P/BMV IPC Index Stock Decision Process with Paired T-Test where A is the set of discrete actions of S&P/BMV IPC 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(Paired T-Test)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(Active Learning (ML)) X S(n):→ (n+6 month) R = r 1 r 2 r 3

n:Time series to forecast

p:Price signals of S&P/BMV IPC 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?

S&P/BMV IPC Index Stock Forecast (Buy or Sell) for (n+6 month)


Sample Set: Neural Network
Stock/Index: S&P/BMV IPC Index S&P/BMV IPC Index
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 S&P/BMV IPC 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%

Adjusted IFRS* Prediction Methods for S&P/BMV IPC Index

  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. Hedge effectiveness is the extent to which changes in the fair value or the cash flows of the hedging instrument offset changes in the fair value or the cash flows of the hedged item (for example, when the hedged item is a risk component, the relevant change in fair value or cash flows of an item is the one that is attributable to the hedged risk). Hedge ineffectiveness is the extent to which the changes in the fair value or the cash flows of the hedging instrument are greater or less than those on the hedged item.
  3. The following are examples of when the objective of the entity's business model may be achieved by both collecting contractual cash flows and selling financial assets. This list of examples is not exhaustive. Furthermore, the examples are not intended to describe all the factors that may be relevant to the assessment of the entity's business model nor specify the relative importance of the factors.
  4. The accounting for the time value of options in accordance with paragraph 6.5.15 applies only to the extent that the time value relates to the hedged item (aligned time value). The time value of an option relates to the hedged item if the critical terms of the option (such as the nominal amount, life and underlying) are aligned with the hedged item. Hence, if the critical terms of the option and the hedged item are not fully aligned, an entity shall determine the aligned time value, ie how much of the time value included in the premium (actual time value) relates to the hedged item (and therefore should be treated in accordance with paragraph 6.5.15). An entity determines the aligned time value using the valuation of the option that would have critical terms that perfectly match the hedged item.

*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

S&P/BMV IPC Index assigned short-term Caa2 & long-term Ba3 forecasted stock rating. We evaluate the prediction models Active Learning (ML) with Paired T-Test1,2,3,4 and conclude that the S&P/BMV IPC Index 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 S&P/BMV IPC Index stock.

Financial State Forecast for S&P/BMV IPC Index S&P/BMV IPC Index Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*Caa2Ba3
Operational Risk 5566
Market Risk4269
Technical Analysis4063
Fundamental Analysis3054
Risk Unsystematic4361

Prediction Confidence Score

Trust metric by Neural Network: 83 out of 100 with 596 signals.

References

  1. Athey S, Imbens GW. 2017b. The state of applied econometrics: causality and policy evaluation. J. Econ. Perspect. 31:3–32
  2. H. Khalil and J. Grizzle. Nonlinear systems, volume 3. Prentice hall Upper Saddle River, 2002.
  3. Chen X. 2007. Large sample sieve estimation of semi-nonparametric models. In Handbook of Econometrics, Vol. 6B, ed. JJ Heckman, EE Learner, pp. 5549–632. Amsterdam: Elsevier
  4. Blei DM, Lafferty JD. 2009. Topic models. In Text Mining: Classification, Clustering, and Applications, ed. A Srivastava, M Sahami, pp. 101–24. Boca Raton, FL: CRC Press
  5. Brailsford, T.J. R.W. Faff (1996), "An evaluation of volatility forecasting techniques," Journal of Banking Finance, 20, 419–438.
  6. Holland PW. 1986. Statistics and causal inference. J. Am. Stat. Assoc. 81:945–60
  7. Hartigan JA, Wong MA. 1979. Algorithm as 136: a k-means clustering algorithm. J. R. Stat. Soc. Ser. C 28:100–8
Frequently Asked QuestionsQ: What is the prediction methodology for S&P/BMV IPC Index stock?
A: S&P/BMV IPC Index stock prediction methodology: We evaluate the prediction models Active Learning (ML) and Paired T-Test
Q: Is S&P/BMV IPC Index stock a buy or sell?
A: The dominant strategy among neural network is to Hold S&P/BMV IPC Index Stock.
Q: Is S&P/BMV IPC Index stock a good investment?
A: The consensus rating for S&P/BMV IPC Index is Hold and assigned short-term Caa2 & long-term Ba3 forecasted stock rating.
Q: What is the consensus rating of S&P/BMV IPC Index stock?
A: The consensus rating for S&P/BMV IPC Index is Hold.
Q: What is the prediction period for S&P/BMV IPC Index stock?
A: The prediction period for S&P/BMV IPC Index is (n+6 month)

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