Modelling A.I. in Economics

CPB Stock Price Prediction (Forecast)

In recent years there has been a significant growth of interest in the incorporation of historical series of variables related to stock prediction into mathematical models or computational algorithms in order to generate predictions or indications about expected price movements. We evaluate Campbell's prediction models with Multi-Task Learning (ML) and Linear Regression1,2,3,4 and conclude that the CPB 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 CPB stock.


Keywords: CPB, Campbell's, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. What is the use of Markov decision process?
  2. What are the most successful trading algorithms?
  3. Dominated Move

CPB Target Price Prediction Modeling Methodology

The research reported in the paper focuses on the stock market prediction problem, the main aim being the development of a methodology to forecast the stock closing price. The methodology is based on some novel variable selection methods and an analysis of neural network and support vector machines based prediction models. Also, a hybrid approach which combines the use of the variables derived from technical and fundamental analysis of stock market indicators in order to improve prediction results of the proposed approaches is reported in this paper. We consider Campbell's Stock Decision Process with Linear Regression where A is the set of discrete actions of CPB 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(Multi-Task Learning (ML)) X S(n):→ (n+16 weeks) i = 1 n s i

n:Time series to forecast

p:Price signals of CPB 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?

CPB Stock Forecast (Buy or Sell) for (n+16 weeks)


Sample Set: Neural Network
Stock/Index: CPB Campbell's
Time series to forecast n: 08 Nov 2022 for (n+16 weeks)

According to price forecasts for (n+16 weeks) period: The dominant strategy among neural network is to Hold CPB 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 Campbell's

  1. An entity may retain the right to a part of the interest payments on transferred assets as compensation for servicing those assets. The part of the interest payments that the entity would give up upon termination or transfer of the servicing contract is allocated to the servicing asset or servicing liability. The part of the interest payments that the entity would not give up is an interest-only strip receivable. For example, if the entity would not give up any interest upon termination or transfer of the servicing contract, the entire interest spread is an interest-only strip receivable. For the purposes of applying paragraph 3.2.13, the fair values of the servicing asset and interest-only strip receivable are used to allocate the carrying amount of the receivable between the part of the asset that is derecognised and the part that continues to be recognised. If there is no servicing fee specified or the fee to be received is not expected to compensate the entity adequately for performing the servicing, a liability for the servicing obligation is recognised at fair value.
  2. For the purpose of applying the requirements in paragraphs 6.4.1(c)(i) and B6.4.4–B6.4.6, an entity shall assume that the interest rate benchmark on which the hedged cash flows and/or the hedged risk (contractually or noncontractually specified) are based, or the interest rate benchmark on which the cash flows of the hedging instrument are based, is not altered as a result of interest rate benchmark reform.
  3. For hedges other than hedges of foreign currency risk, when an entity designates a non-derivative financial asset or a non-derivative financial liability measured at fair value through profit or loss as a hedging instrument, it may only designate the non-derivative financial instrument in its entirety or a proportion of it.
  4. For the purposes of applying the requirement in paragraph 5.7.7(a), credit risk is different from asset-specific performance risk. Asset-specific performance risk is not related to the risk that an entity will fail to discharge a particular obligation but instead it is related to the risk that a single asset or a group of assets will perform poorly (or not at all).

*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

Campbell's assigned short-term B2 & long-term B1 forecasted stock rating. We evaluate the prediction models Multi-Task Learning (ML) with Linear Regression1,2,3,4 and conclude that the CPB 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 CPB stock.

Financial State Forecast for CPB Campbell's Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*B2B1
Operational Risk 8776
Market Risk4448
Technical Analysis3685
Fundamental Analysis7332
Risk Unsystematic4749

Prediction Confidence Score

Trust metric by Neural Network: 87 out of 100 with 624 signals.

References

  1. Breusch, T. S. (1978), "Testing for autocorrelation in dynamic linear models," Australian Economic Papers, 17, 334–355.
  2. Efron B, Hastie T. 2016. Computer Age Statistical Inference, Vol. 5. Cambridge, UK: Cambridge Univ. Press
  3. G. Konidaris, S. Osentoski, and P. Thomas. Value function approximation in reinforcement learning using the Fourier basis. In AAAI, 2011
  4. Jacobs B, Donkers B, Fok D. 2014. Product Recommendations Based on Latent Purchase Motivations. Rotterdam, Neth.: ERIM
  5. Candès E, Tao T. 2007. The Dantzig selector: statistical estimation when p is much larger than n. Ann. Stat. 35:2313–51
  6. Friedman JH. 2002. Stochastic gradient boosting. Comput. Stat. Data Anal. 38:367–78
  7. Andrews, D. W. K. (1993), "Tests for parameter instability and structural change with unknown change point," Econometrica, 61, 821–856.
Frequently Asked QuestionsQ: What is the prediction methodology for CPB stock?
A: CPB stock prediction methodology: We evaluate the prediction models Multi-Task Learning (ML) and Linear Regression
Q: Is CPB stock a buy or sell?
A: The dominant strategy among neural network is to Hold CPB Stock.
Q: Is Campbell's stock a good investment?
A: The consensus rating for Campbell's is Hold and assigned short-term B2 & long-term B1 forecasted stock rating.
Q: What is the consensus rating of CPB stock?
A: The consensus rating for CPB is Hold.
Q: What is the prediction period for CPB stock?
A: The prediction period for CPB is (n+16 weeks)

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