Modelling A.I. in Economics

Can stock prices be predicted? (LON:PIER Stock Forecast) (Forecast)

This paper studies the possibilities of making prediction of stock market prices using historical data and machine learning algorithms. We evaluate BRIGHTON PIER GROUP PLC (THE) prediction models with Modular Neural Network (Market Direction Analysis) and Stepwise Regression1,2,3,4 and conclude that the LON:PIER stock is predictable in the short/long term. According to price forecasts for (n+16 weeks) period: The dominant strategy among neural network is to Hold LON:PIER stock.


Keywords: LON:PIER, BRIGHTON PIER GROUP PLC (THE), stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. Can statistics predict the future?
  2. What is Markov decision process in reinforcement learning?
  3. Is Target price a good indicator?

LON:PIER Target Price Prediction Modeling Methodology

In modern financial market, the most crucial problem is to find essential approach to outline and visualizing the predictions in stock-markets to be made by individuals in order to attain maximum profit by investments. The stock market is a transformative, non-straight dynamical and complex system. Long term investment is one of the major investment decisions. Though, evaluating shares and calculating elementary values for companies for long term investment is difficult. In this paper we are going to present comparison of machine learning aided algorithms to evaluate the stock prices in the future to analyze market behaviour. We consider BRIGHTON PIER GROUP PLC (THE) Stock Decision Process with Stepwise Regression where A is the set of discrete actions of LON:PIER 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(Stepwise 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 Direction Analysis)) X S(n):→ (n+16 weeks) S = s 1 s 2 s 3

n:Time series to forecast

p:Price signals of LON:PIER 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:PIER Stock Forecast (Buy or Sell) for (n+16 weeks)


Sample Set: Neural Network
Stock/Index: LON:PIER BRIGHTON PIER GROUP PLC (THE)
Time series to forecast n: 05 Nov 2022 for (n+16 weeks)

According to price forecasts for (n+16 weeks) period: The dominant strategy among neural network is to Hold LON:PIER 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 BRIGHTON PIER GROUP PLC (THE)

  1. Hedging relationships that qualified for hedge accounting in accordance with IAS 39 that also qualify for hedge accounting in accordance with the criteria of this Standard (see paragraph 6.4.1), after taking into account any rebalancing of the hedging relationship on transition (see paragraph 7.2.25(b)), shall be regarded as continuing hedging relationships.
  2. The rebuttable presumption in paragraph 5.5.11 is not an absolute indicator that lifetime expected credit losses should be recognised, but is presumed to be the latest point at which lifetime expected credit losses should be recognised even when using forward-looking information (including macroeconomic factors on a portfolio level).
  3. Adjusting the hedge ratio allows an entity to respond to changes in the relationship between the hedging instrument and the hedged item that arise from their underlyings or risk variables. For example, a hedging relationship in which the hedging instrument and the hedged item have different but related underlyings changes in response to a change in the relationship between those two underlyings (for example, different but related reference indices, rates or prices). Hence, rebalancing allows the continuation of a hedging relationship in situations in which the relationship between the hedging instrument and the hedged item chang
  4. If there are changes in circumstances that affect hedge effectiveness, an entity may have to change the method for assessing whether a hedging relationship meets the hedge effectiveness requirements in order to ensure that the relevant characteristics of the hedging relationship, including the sources of hedge ineffectiveness, are still captured.

*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

BRIGHTON PIER GROUP PLC (THE) assigned short-term Ba3 & long-term B1 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Market Direction Analysis) with Stepwise Regression1,2,3,4 and conclude that the LON:PIER stock is predictable in the short/long term. According to price forecasts for (n+16 weeks) period: The dominant strategy among neural network is to Hold LON:PIER stock.

Financial State Forecast for LON:PIER BRIGHTON PIER GROUP PLC (THE) Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*Ba3B1
Operational Risk 8185
Market Risk5733
Technical Analysis7246
Fundamental Analysis4382
Risk Unsystematic7736

Prediction Confidence Score

Trust metric by Neural Network: 74 out of 100 with 787 signals.

References

  1. LeCun Y, Bengio Y, Hinton G. 2015. Deep learning. Nature 521:436–44
  2. Farrell MH, Liang T, Misra S. 2018. Deep neural networks for estimation and inference: application to causal effects and other semiparametric estimands. arXiv:1809.09953 [econ.EM]
  3. LeCun Y, Bengio Y, Hinton G. 2015. Deep learning. Nature 521:436–44
  4. J. Ott. A Markov decision model for a surveillance application and risk-sensitive Markov decision processes. PhD thesis, Karlsruhe Institute of Technology, 2010.
  5. Bierens HJ. 1987. Kernel estimators of regression functions. In Advances in Econometrics: Fifth World Congress, Vol. 1, ed. TF Bewley, pp. 99–144. Cambridge, UK: Cambridge Univ. Press
  6. Hartigan JA, Wong MA. 1979. Algorithm as 136: a k-means clustering algorithm. J. R. Stat. Soc. Ser. C 28:100–8
  7. D. Bertsekas. Nonlinear programming. Athena Scientific, 1999.
Frequently Asked QuestionsQ: What is the prediction methodology for LON:PIER stock?
A: LON:PIER stock prediction methodology: We evaluate the prediction models Modular Neural Network (Market Direction Analysis) and Stepwise Regression
Q: Is LON:PIER stock a buy or sell?
A: The dominant strategy among neural network is to Hold LON:PIER Stock.
Q: Is BRIGHTON PIER GROUP PLC (THE) stock a good investment?
A: The consensus rating for BRIGHTON PIER GROUP PLC (THE) is Hold and assigned short-term Ba3 & long-term B1 forecasted stock rating.
Q: What is the consensus rating of LON:PIER stock?
A: The consensus rating for LON:PIER is Hold.
Q: What is the prediction period for LON:PIER stock?
A: The prediction period for LON:PIER is (n+16 weeks)

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