Modelling A.I. in Economics

Should I Buy Stocks Now or Wait Amid Such Uncertainty? (Jakarta Stock Exchange Composite Index Stock Prediction) (Forecast)

Accurate prediction of stock market returns is a very challenging task due to volatile and non-linear nature of the financial stock markets. With the introduction of artificial intelligence and increased computational capabilities, programmed methods of prediction have proved to be more efficient in predicting stock prices. We evaluate Jakarta Stock Exchange Composite Index prediction models with Modular Neural Network (Social Media Sentiment Analysis) and Sign Test1,2,3,4 and conclude that the Jakarta Stock Exchange Composite Index 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 Jakarta Stock Exchange Composite Index stock.


Keywords: Jakarta Stock Exchange Composite Index, Jakarta Stock Exchange Composite Index, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. Is now good time to invest?
  2. Can stock prices be predicted?
  3. Buy, Sell and Hold Signals

Jakarta Stock Exchange Composite Index Target Price Prediction Modeling Methodology

Prediction of stock market movement is extremely difficult due to its high mutable nature. The rapid ups and downs occur in stock market because of impact from foreign commodities like emotional behavior of investors, political, psychological and economical factors. Continuous unsettlement in the stock market is major reason why investors sell out at the wrong time and often fail to gain the benefit. While investing in stock market investors must not forget the risk of reward rule and expose their holdings to greater risks. Although it is not possible predict stock market movement with full accuracy, losses from selling stocks at wrong time and its impacts can be reduce to greater extent using prediction of stock market movement based on analysis of historical data. We consider Jakarta Stock Exchange Composite Index Stock Decision Process with Sign Test where A is the set of discrete actions of Jakarta Stock Exchange Composite 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(Sign 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(Modular Neural Network (Social Media Sentiment Analysis)) X S(n):→ (n+16 weeks) r s rs

n:Time series to forecast

p:Price signals of Jakarta Stock Exchange Composite 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?

Jakarta Stock Exchange Composite Index Stock Forecast (Buy or Sell) for (n+16 weeks)


Sample Set: Neural Network
Stock/Index: Jakarta Stock Exchange Composite Index Jakarta Stock Exchange Composite Index
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 Jakarta Stock Exchange Composite 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 Jakarta Stock Exchange Composite Index

  1. IFRS 16, issued in January 2016, amended paragraphs 2.1, 5.5.15, B4.3.8, B5.5.34 and B5.5.46. An entity shall apply those amendments when it applies IFRS 16.
  2. IFRS 15, issued in May 2014, amended paragraphs 3.1.1, 4.2.1, 5.1.1, 5.2.1, 5.7.6, B3.2.13, B5.7.1, C5 and C42 and deleted paragraph C16 and its related heading. Paragraphs 5.1.3 and 5.7.1A, and a definition to Appendix A, were added. An entity shall apply those amendments when it applies IFRS 15.
  3. When measuring a loss allowance for a lease receivable, the cash flows used for determining the expected credit losses should be consistent with the cash flows used in measuring the lease receivable in accordance with IFRS 16 Leases.
  4. If a guarantee provided by an entity to pay for default losses on a transferred asset prevents the transferred asset from being derecognised to the extent of the continuing involvement, the transferred asset at the date of the transfer is measured at the lower of (i) the carrying amount of the asset and (ii) the maximum amount of the consideration received in the transfer that the entity could be required to repay ('the guarantee amount'). The associated liability is initially measured at the guarantee amount plus the fair value of the guarantee (which is normally the consideration received for the guarantee). Subsequently, the initial fair value of the guarantee is recognised in profit or loss when (or as) the obligation is satisfied (in accordance with the principles of IFRS 15) and the carrying value of the asset is reduced by any loss allowance.

*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

Jakarta Stock Exchange Composite Index assigned short-term Caa2 & long-term B2 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Social Media Sentiment Analysis) with Sign Test1,2,3,4 and conclude that the Jakarta Stock Exchange Composite Index 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 Jakarta Stock Exchange Composite Index stock.

Financial State Forecast for Jakarta Stock Exchange Composite Index Jakarta Stock Exchange Composite Index Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*Caa2B2
Operational Risk 3051
Market Risk3372
Technical Analysis3554
Fundamental Analysis6531
Risk Unsystematic5346

Prediction Confidence Score

Trust metric by Neural Network: 85 out of 100 with 755 signals.

References

  1. 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
  2. Hastie T, Tibshirani R, Friedman J. 2009. The Elements of Statistical Learning. Berlin: Springer
  3. Semenova V, Goldman M, Chernozhukov V, Taddy M. 2018. Orthogonal ML for demand estimation: high dimensional causal inference in dynamic panels. arXiv:1712.09988 [stat.ML]
  4. LeCun Y, Bengio Y, Hinton G. 2015. Deep learning. Nature 521:436–44
  5. Bottou L. 1998. Online learning and stochastic approximations. In On-Line Learning in Neural Networks, ed. D Saad, pp. 9–42. New York: ACM
  6. 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
  7. Chernozhukov V, Chetverikov D, Demirer M, Duflo E, Hansen C, Newey W. 2017. Double/debiased/ Neyman machine learning of treatment effects. Am. Econ. Rev. 107:261–65
Frequently Asked QuestionsQ: What is the prediction methodology for Jakarta Stock Exchange Composite Index stock?
A: Jakarta Stock Exchange Composite Index stock prediction methodology: We evaluate the prediction models Modular Neural Network (Social Media Sentiment Analysis) and Sign Test
Q: Is Jakarta Stock Exchange Composite Index stock a buy or sell?
A: The dominant strategy among neural network is to Hold Jakarta Stock Exchange Composite Index Stock.
Q: Is Jakarta Stock Exchange Composite Index stock a good investment?
A: The consensus rating for Jakarta Stock Exchange Composite Index is Hold and assigned short-term Caa2 & long-term B2 forecasted stock rating.
Q: What is the consensus rating of Jakarta Stock Exchange Composite Index stock?
A: The consensus rating for Jakarta Stock Exchange Composite Index is Hold.
Q: What is the prediction period for Jakarta Stock Exchange Composite Index stock?
A: The prediction period for Jakarta Stock Exchange Composite Index is (n+16 weeks)

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