Modelling A.I. in Economics

LON:HUM Target Price Prediction (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 HUMMINGBIRD RESOURCES PLC prediction models with Modular Neural Network (Market Volatility Analysis) and Pearson Correlation1,2,3,4 and conclude that the LON:HUM 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 LON:HUM stock.


Keywords: LON:HUM, HUMMINGBIRD RESOURCES PLC, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. What is neural prediction?
  2. How do you pick a stock?
  3. What is neural prediction?

LON:HUM Target Price Prediction Modeling Methodology

One decision in Stock Market can make huge impact on an investor's life. The stock market is a complex system and often covered in mystery, it is therefore, very difficult to analyze all the impacting factors before making a decision. In this research, we have tried to design a stock market prediction model which is based on different factors. We consider HUMMINGBIRD RESOURCES PLC Stock Decision Process with Pearson Correlation where A is the set of discrete actions of LON:HUM 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(Pearson Correlation)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 Volatility Analysis)) X S(n):→ (n+4 weeks) S = s 1 s 2 s 3

n:Time series to forecast

p:Price signals of LON:HUM 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:HUM Stock Forecast (Buy or Sell) for (n+4 weeks)


Sample Set: Neural Network
Stock/Index: LON:HUM HUMMINGBIRD RESOURCES PLC
Time series to forecast n: 06 Nov 2022 for (n+4 weeks)

According to price forecasts for (n+4 weeks) period: The dominant strategy among neural network is to Hold LON:HUM 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 HUMMINGBIRD RESOURCES PLC

  1. An entity shall apply Prepayment Features with Negative Compensation (Amendments to IFRS 9) retrospectively in accordance with IAS 8, except as specified in paragraphs 7.2.30–7.2.34
  2. A regular way purchase or sale gives rise to a fixed price commitment between trade date and settlement date that meets the definition of a derivative. However, because of the short duration of the commitment it is not recognised as a derivative financial instrument. Instead, this Standard provides for special accounting for such regular way contracts (see paragraphs 3.1.2 and B3.1.3–B3.1.6).
  3. The definition of a derivative refers to non-financial variables that are not specific to a party to the contract. These include an index of earthquake losses in a particular region and an index of temperatures in a particular city. Non-financial variables specific to a party to the contract include the occurrence or non-occurrence of a fire that damages or destroys an asset of a party to the contract. A change in the fair value of a non-financial asset is specific to the owner if the fair value reflects not only changes in market prices for such assets (a financial variable) but also the condition of the specific non-financial asset held (a non-financial variable). For example, if a guarantee of the residual value of a specific car exposes the guarantor to the risk of changes in the car's physical condition, the change in that residual value is specific to the owner of the car.
  4. To be eligible for designation as a hedged item, a risk component must be a separately identifiable component of the financial or the non-financial item, and the changes in the cash flows or the fair value of the item attributable to changes in that risk component must be reliably measurable.

*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

HUMMINGBIRD RESOURCES PLC assigned short-term Ba1 & long-term B2 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Market Volatility Analysis) with Pearson Correlation1,2,3,4 and conclude that the LON:HUM 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 LON:HUM stock.

Financial State Forecast for LON:HUM HUMMINGBIRD RESOURCES PLC Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*Ba1B2
Operational Risk 7756
Market Risk8933
Technical Analysis4481
Fundamental Analysis8747
Risk Unsystematic6455

Prediction Confidence Score

Trust metric by Neural Network: 73 out of 100 with 561 signals.

References

  1. Byron, R. P. O. Ashenfelter (1995), "Predicting the quality of an unborn grange," Economic Record, 71, 40–53.
  2. V. Borkar. An actor-critic algorithm for constrained Markov decision processes. Systems & Control Letters, 54(3):207–213, 2005.
  3. J. Harb and D. Precup. Investigating recurrence and eligibility traces in deep Q-networks. In Deep Reinforcement Learning Workshop, NIPS 2016, Barcelona, Spain, 2016.
  4. N. B ̈auerle and A. Mundt. Dynamic mean-risk optimization in a binomial model. Mathematical Methods of Operations Research, 70(2):219–239, 2009.
  5. Tibshirani R, Hastie T. 1987. Local likelihood estimation. J. Am. Stat. Assoc. 82:559–67
  6. Hastie T, Tibshirani R, Tibshirani RJ. 2017. Extended comparisons of best subset selection, forward stepwise selection, and the lasso. arXiv:1707.08692 [stat.ME]
  7. Nie X, Wager S. 2019. Quasi-oracle estimation of heterogeneous treatment effects. arXiv:1712.04912 [stat.ML]
Frequently Asked QuestionsQ: What is the prediction methodology for LON:HUM stock?
A: LON:HUM stock prediction methodology: We evaluate the prediction models Modular Neural Network (Market Volatility Analysis) and Pearson Correlation
Q: Is LON:HUM stock a buy or sell?
A: The dominant strategy among neural network is to Hold LON:HUM Stock.
Q: Is HUMMINGBIRD RESOURCES PLC stock a good investment?
A: The consensus rating for HUMMINGBIRD RESOURCES PLC is Hold and assigned short-term Ba1 & long-term B2 forecasted stock rating.
Q: What is the consensus rating of LON:HUM stock?
A: The consensus rating for LON:HUM is Hold.
Q: What is the prediction period for LON:HUM stock?
A: The prediction period for LON:HUM is (n+4 weeks)

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