SMIN Options & Futures Prediction

Stock market forecasting is considered to be a challenging topic among time series forecasting. This study proposes a novel two-stage ensemble machine learning model named SVR-ENANFIS for stock price prediction by combining features of support vector regression (SVR) and ensemble adaptive neuro fuzzy inference system (ENANFIS). We evaluate Smiths Group prediction models with Modular Neural Network (Financial Sentiment Analysis) and Polynomial Regression1,2,3,4 and conclude that the SMIN stock is predictable in the short/long term. According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Hold SMIN stock.


Keywords: SMIN, Smiths Group, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. Investment Risk
  2. What is a prediction confidence?
  3. Fundemental Analysis with Algorithmic Trading

SMIN Target Price Prediction Modeling Methodology

Prediction of stocks is complicated by the dynamic, complex, and chaotic environment of the stock market. Many studies predict stock price movements using deep learning models. Although the attention mechanism has gained popularity recently in neural machine translation, little focus has been devoted to attention-based deep learning models for stock prediction. We consider Smiths Group Stock Decision Process with Polynomial Regression where A is the set of discrete actions of SMIN 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(Polynomial 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 (Financial Sentiment Analysis)) X S(n):→ (n+6 month) i = 1 n r i

n:Time series to forecast

p:Price signals of SMIN 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?

SMIN Stock Forecast (Buy or Sell) for (n+6 month)


Sample Set: Neural Network
Stock/Index: SMIN Smiths Group
Time series to forecast n: 14 Nov 2022 for (n+6 month)

According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Hold SMIN 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 Smiths Group

  1. To the extent that a transfer of a financial asset does not qualify for derecognition, the transferor's contractual rights or obligations related to the transfer are not accounted for separately as derivatives if recognising both the derivative and either the transferred asset or the liability arising from the transfer would result in recognising the same rights or obligations twice. For example, a call option retained by the transferor may prevent a transfer of financial assets from being accounted for as a sale. In that case, the call option is not separately recognised as a derivative asset.
  2. One of the defining characteristics of a derivative is that it has an initial net investment that is smaller than would be required for other types of contracts that would be expected to have a similar response to changes in market factors. An option contract meets that definition because the premium is less than the investment that would be required to obtain the underlying financial instrument to which the option is linked. A currency swap that requires an initial exchange of different currencies of equal fair values meets the definition because it has a zero initial net investment.
  3. If a financial asset contains a contractual term that could change the timing or amount of contractual cash flows (for example, if the asset can be prepaid before maturity or its term can be extended), the entity must determine whether the contractual cash flows that could arise over the life of the instrument due to that contractual term are solely payments of principal and interest on the principal amount outstanding. To make this determination, the entity must assess the contractual cash flows that could arise both before, and after, the change in contractual cash flows. The entity may also need to assess the nature of any contingent event (ie the trigger) that would change the timing or amount of the contractual cash flows. While the nature of the contingent event in itself is not a determinative factor in assessing whether the contractual cash flows are solely payments of principal and interest, it may be an indicator. For example, compare a financial instrument with an interest rate that is reset to a higher rate if the debtor misses a particular number of payments to a financial instrument with an interest rate that is reset to a higher rate if a specified equity index reaches a particular level. It is more likely in the former case that the contractual cash flows over the life of the instrument will be solely payments of principal and interest on the principal amount outstanding because of the relationship between missed payments and an increase in credit risk. (See also paragraph B4.1.18.)
  4. To the extent that a transfer of a financial asset does not qualify for derecognition, the transferee does not recognise the transferred asset as its asset. The transferee derecognises the cash or other consideration paid and recognises a receivable from the transferor. If the transferor has both a right and an obligation to reacquire control of the entire transferred asset for a fixed amount (such as under a repurchase agreement), the transferee may measure its receivable at amortised cost if it meets the criteria in paragraph 4.1.2.

*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

Smiths Group assigned short-term Caa2 & long-term Ba3 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Financial Sentiment Analysis) with Polynomial Regression1,2,3,4 and conclude that the SMIN stock is predictable in the short/long term. According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Hold SMIN stock.

Financial State Forecast for SMIN Smiths Group Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*Caa2Ba3
Operational Risk 3956
Market Risk7065
Technical Analysis3572
Fundamental Analysis4574
Risk Unsystematic3056

Prediction Confidence Score

Trust metric by Neural Network: 73 out of 100 with 499 signals.

References

  1. Athey S, Mobius MM, Pál J. 2017c. The impact of aggregators on internet news consumption. Unpublished manuscript, Grad. School Bus., Stanford Univ., Stanford, CA
  2. Abadie A, Diamond A, Hainmueller J. 2010. Synthetic control methods for comparative case studies: estimat- ing the effect of California's tobacco control program. J. Am. Stat. Assoc. 105:493–505
  3. Ashley, R. (1983), "On the usefulness of macroeconomic forecasts as inputs to forecasting models," Journal of Forecasting, 2, 211–223.
  4. Athey S. 2019. The impact of machine learning on economics. In The Economics of Artificial Intelligence: An Agenda, ed. AK Agrawal, J Gans, A Goldfarb. Chicago: Univ. Chicago Press. In press
  5. G. J. Laurent, L. Matignon, and N. L. Fort-Piat. The world of independent learners is not Markovian. Int. J. Know.-Based Intell. Eng. Syst., 15(1):55–64, 2011
  6. M. Petrik and D. Subramanian. An approximate solution method for large risk-averse Markov decision processes. In Proceedings of the 28th International Conference on Uncertainty in Artificial Intelligence, 2012.
  7. K. Boda and J. Filar. Time consistent dynamic risk measures. Mathematical Methods of Operations Research, 63(1):169–186, 2006
Frequently Asked QuestionsQ: What is the prediction methodology for SMIN stock?
A: SMIN stock prediction methodology: We evaluate the prediction models Modular Neural Network (Financial Sentiment Analysis) and Polynomial Regression
Q: Is SMIN stock a buy or sell?
A: The dominant strategy among neural network is to Hold SMIN Stock.
Q: Is Smiths Group stock a good investment?
A: The consensus rating for Smiths Group is Hold and assigned short-term Caa2 & long-term Ba3 forecasted stock rating.
Q: What is the consensus rating of SMIN stock?
A: The consensus rating for SMIN is Hold.
Q: What is the prediction period for SMIN stock?
A: The prediction period for SMIN is (n+6 month)

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