## Summary

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 evaluate US Small Cap 2000 Index prediction models with Modular Neural Network (Market News Sentiment Analysis) and Independent T-Test ^{1,2,3,4} and conclude that the US Small Cap 2000 Index stock is predictable in the short/long term. **

**According to price forecasts for (n+8 weeks) period: The dominant strategy among neural network is to Hold US Small Cap 2000 Index stock.**

## Key Points

- What are main components of Markov decision process?
- Fundemental Analysis with Algorithmic Trading
- Trading Interaction

## US Small Cap 2000 Index Target Price Prediction Modeling Methodology

We consider US Small Cap 2000 Index Stock Decision Process with Modular Neural Network (Market News Sentiment Analysis) where A is the set of discrete actions of US Small Cap 2000 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(Independent T-Test)

^{5,6,7}= $\begin{array}{cccc}{p}_{\mathrm{a}1}& {p}_{\mathrm{a}2}& \dots & {p}_{1n}\\ & \vdots \\ {p}_{j1}& {p}_{j2}& \dots & {p}_{jn}\\ & \vdots \\ {p}_{k1}& {p}_{k2}& \dots & {p}_{kn}\\ & \vdots \\ {p}_{n1}& {p}_{n2}& \dots & {p}_{nn}\end{array}$ X R(Modular Neural Network (Market News Sentiment Analysis)) X S(n):→ (n+8 weeks) $\sum _{i=1}^{n}\left({r}_{i}\right)$

n:Time series to forecast

p:Price signals of US Small Cap 2000 Index stock

j:Nash equilibria (Neural Network)

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?

## US Small Cap 2000 Index Stock Forecast (Buy or Sell) for (n+8 weeks)

**Sample Set:**Neural Network

**Stock/Index:**US Small Cap 2000 Index US Small Cap 2000 Index

**Time series to forecast n: 29 Nov 2022**for (n+8 weeks)

**According to price forecasts for (n+8 weeks) period: The dominant strategy among neural network is to Hold US Small Cap 2000 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 US Small Cap 2000 Index

- A hedge of a firm commitment (for example, a hedge of the change in fuel price relating to an unrecognised contractual commitment by an electric utility to purchase fuel at a fixed price) is a hedge of an exposure to a change in fair value. Accordingly, such a hedge is a fair value hedge. However, in accordance with paragraph 6.5.4, a hedge of the foreign currency risk of a firm commitment could alternatively be accounted for as a cash flow hedge.
- 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.
- If the holder cannot assess the conditions in paragraph B4.1.21 at initial recognition, the tranche must be measured at fair value through profit or loss. If the underlying pool of instruments can change after initial recognition in such a way that the pool may not meet the conditions in paragraphs B4.1.23–B4.1.24, the tranche does not meet the conditions in paragraph B4.1.21 and must be measured at fair value through profit or loss. However, if the underlying pool includes instruments that are collateralised by assets that do not meet the conditions in paragraphs B4.1.23–B4.1.24, the ability to take possession of such assets shall be disregarded for the purposes of applying this paragraph unless the entity acquired the tranche with the intention of controlling the collateral.
- A portfolio of financial assets that is managed and whose performance is evaluated on a fair value basis (as described in paragraph 4.2.2(b)) is neither held to collect contractual cash flows nor held both to collect contractual cash flows and to sell financial assets. The entity is primarily focused on fair value information and uses that information to assess the assets' performance and to make decisions. In addition, a portfolio of financial assets that meets the definition of held for trading is not held to collect contractual cash flows or held both to collect contractual cash flows and to sell financial assets. For such portfolios, the collection of contractual cash flows is only incidental to achieving the business model's objective. Consequently, such portfolios of financial assets must be measured at fair value through profit or loss.

*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

US Small Cap 2000 Index assigned short-term B1 & long-term B2 forecasted stock rating.** We evaluate the prediction models Modular Neural Network (Market News Sentiment Analysis) with Independent T-Test ^{1,2,3,4} and conclude that the US Small Cap 2000 Index stock is predictable in the short/long term.**

**According to price forecasts for (n+8 weeks) period: The dominant strategy among neural network is to Hold US Small Cap 2000 Index stock.**

### Financial State Forecast for US Small Cap 2000 Index US Small Cap 2000 Index Stock Options & Futures

Rating | Short-Term | Long-Term Senior |
---|---|---|

Outlook* | B1 | B2 |

Operational Risk | 70 | 62 |

Market Risk | 67 | 31 |

Technical Analysis | 83 | 53 |

Fundamental Analysis | 47 | 34 |

Risk Unsystematic | 31 | 70 |

### Prediction Confidence Score

## References

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- White H. 1992. Artificial Neural Networks: Approximation and Learning Theory. Oxford, UK: Blackwell
- 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
- Mnih A, Teh YW. 2012. A fast and simple algorithm for training neural probabilistic language models. In Proceedings of the 29th International Conference on Machine Learning, pp. 419–26. La Jolla, CA: Int. Mach. Learn. Soc.
- L. Panait and S. Luke. Cooperative multi-agent learning: The state of the art. Autonomous Agents and Multi-Agent Systems, 11(3):387–434, 2005.
- Miller A. 2002. Subset Selection in Regression. New York: CRC Press
- Bessler, D. A. T. Covey (1991), "Cointegration: Some results on U.S. cattle prices," Journal of Futures Markets, 11, 461–474.

## Frequently Asked Questions

Q: What is the prediction methodology for US Small Cap 2000 Index stock?A: US Small Cap 2000 Index stock prediction methodology: We evaluate the prediction models Modular Neural Network (Market News Sentiment Analysis) and Independent T-Test

Q: Is US Small Cap 2000 Index stock a buy or sell?

A: The dominant strategy among neural network is to Hold US Small Cap 2000 Index Stock.

Q: Is US Small Cap 2000 Index stock a good investment?

A: The consensus rating for US Small Cap 2000 Index is Hold and assigned short-term B1 & long-term B2 forecasted stock rating.

Q: What is the consensus rating of US Small Cap 2000 Index stock?

A: The consensus rating for US Small Cap 2000 Index is Hold.

Q: What is the prediction period for US Small Cap 2000 Index stock?

A: The prediction period for US Small Cap 2000 Index is (n+8 weeks)

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