Can stock prices be predicted? (FDX Stock Forecast)

FedEx Research Report

Summary

Three networks are compared for low false alarm stock trend predictions. Short-term trends, particularly attractive for neural network analysis, can be used profitably in scenarios such as option trading, but only with significant risk. Therefore, we focus on limiting false alarms, which improves the risk/reward ratio by preventing losses. To predict stock trends, we exploit time delay, recurrent, and probabilistic neural networks (TDNN, RNN, and PNN, respectively), utilizing conjugate gradient and multistream extended Kalman filter training for TDNN and RNN. We evaluate FedEx prediction models with Modular Neural Network (DNN Layer) and Linear Regression1,2,3,4 and conclude that the FDX stock is predictable in the short/long term. According to price forecasts for (n+1 year) period: The dominant strategy among neural network is to Hold FDX stock.

Key Points

  1. Short/Long Term Stocks
  2. What is neural prediction?
  3. What are main components of Markov decision process?

FDX Target Price Prediction Modeling Methodology

We consider FedEx Stock Decision Process with Modular Neural Network (DNN Layer) where A is the set of discrete actions of FDX 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(Linear 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 (DNN Layer)) X S(n):→ (n+1 year) i = 1 n a i

n:Time series to forecast

p:Price signals of FDX 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?

FDX Stock Forecast (Buy or Sell) for (n+1 year)

Sample Set: Neural Network
Stock/Index: FDX FedEx
Time series to forecast n: 19 Nov 2022 for (n+1 year)

According to price forecasts for (n+1 year) period: The dominant strategy among neural network is to Hold FDX 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 FedEx

  1. In cases such as those described in the preceding paragraph, to designate, at initial recognition, the financial assets and financial liabilities not otherwise so measured as at fair value through profit or loss may eliminate or significantly reduce the measurement or recognition inconsistency and produce more relevant information. For practical purposes, the entity need not enter into all of the assets and liabilities giving rise to the measurement or recognition inconsistency at exactly the same time. A reasonable delay is permitted provided that each transaction is designated as at fair value through profit or loss at its initial recognition and, at that time, any remaining transactions are expected to occur.
  2. Paragraph 4.1.1(b) requires an entity to classify a financial asset on the basis of its contractual cash flow characteristics if the financial asset is held within a business model whose objective is to hold assets to collect contractual cash flows or within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, unless paragraph 4.1.5 applies. To do so, the condition in paragraphs 4.1.2(b) and 4.1.2A(b) requires an entity to determine whether the asset's contractual cash flows are solely payments of principal and interest on the principal amount outstanding.
  3. Changes in market conditions that give rise to market risk include changes in a benchmark interest rate, the price of another entity's financial instrument, a commodity price, a foreign exchange rate or an index of prices or rates.
  4. An entity shall apply this Standard for annual periods beginning on or after 1 January 2018. Earlier application is permitted. If an entity elects to apply this Standard early, it must disclose that fact and apply all of the requirements in this Standard at the same time (but see also paragraphs 7.1.2, 7.2.21 and 7.3.2). It shall also, at the same time, apply the amendments in Appendix C.

*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

FedEx assigned short-term B2 & long-term Ba2 forecasted stock rating. We evaluate the prediction models Modular Neural Network (DNN Layer) with Linear Regression1,2,3,4 and conclude that the FDX stock is predictable in the short/long term. According to price forecasts for (n+1 year) period: The dominant strategy among neural network is to Hold FDX stock.

Financial State Forecast for FDX FedEx Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*B2Ba2
Operational Risk 4181
Market Risk4486
Technical Analysis3342
Fundamental Analysis8274
Risk Unsystematic7051

Prediction Confidence Score

Trust metric by Neural Network: 77 out of 100 with 592 signals.

References

  1. V. Borkar and R. Jain. Risk-constrained Markov decision processes. IEEE Transaction on Automatic Control, 2014
  2. G. Shani, R. Brafman, and D. Heckerman. An MDP-based recommender system. In Proceedings of the Eigh- teenth conference on Uncertainty in artificial intelligence, pages 453–460. Morgan Kaufmann Publishers Inc., 2002
  3. R. Williams. Simple statistical gradient-following algorithms for connectionist reinforcement learning. Ma- chine learning, 8(3-4):229–256, 1992
  4. J. Spall. Multivariate stochastic approximation using a simultaneous perturbation gradient approximation. IEEE Transactions on Automatic Control, 37(3):332–341, 1992.
  5. Candès EJ, Recht B. 2009. Exact matrix completion via convex optimization. Found. Comput. Math. 9:717
  6. S. Proper and K. Tumer. Modeling difference rewards for multiagent learning (extended abstract). In Proceedings of the Eleventh International Joint Conference on Autonomous Agents and Multiagent Systems, Valencia, Spain, June 2012
  7. M. J. Hausknecht and P. Stone. Deep recurrent Q-learning for partially observable MDPs. CoRR, abs/1507.06527, 2015
Frequently Asked QuestionsQ: What is the prediction methodology for FDX stock?
A: FDX stock prediction methodology: We evaluate the prediction models Modular Neural Network (DNN Layer) and Linear Regression
Q: Is FDX stock a buy or sell?
A: The dominant strategy among neural network is to Hold FDX Stock.
Q: Is FedEx stock a good investment?
A: The consensus rating for FedEx is Hold and assigned short-term B2 & long-term Ba2 forecasted stock rating.
Q: What is the consensus rating of FDX stock?
A: The consensus rating for FDX is Hold.
Q: What is the prediction period for FDX stock?
A: The prediction period for FDX is (n+1 year)

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