Modelling A.I. in Economics

What is LON:NTEA stock 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 NORTHERN ELECTRIC PLC prediction models with Supervised Machine Learning (ML) and Lasso Regression1,2,3,4 and conclude that the LON:NTEA 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 Buy LON:NTEA stock.


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

Key Points

  1. Stock Rating
  2. How do you decide buy or sell a stock?
  3. Trust metric by Neural Network

LON:NTEA Target Price Prediction Modeling Methodology

Stock prediction with data mining techniques is one of the most important issues in finance being investigated by researchers across the globe. Data mining techniques can be used extensively in the financial markets to help investors make qualitative decision. One of the techniques is artificial neural network (ANN). However, in the application of ANN for predicting the financial market the use of technical analysis variables for stock prediction is predominant. In this paper, we present a hybridized approach which combines the use of the variables of technical and fundamental analysis of stock market indicators for prediction of future price of stock in order to improve on the existing approaches. We consider NORTHERN ELECTRIC PLC Stock Decision Process with Lasso Regression where A is the set of discrete actions of LON:NTEA 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(Lasso 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(Supervised Machine Learning (ML)) X S(n):→ (n+6 month) S = s 1 s 2 s 3

n:Time series to forecast

p:Price signals of LON:NTEA 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:NTEA Stock Forecast (Buy or Sell) for (n+6 month)


Sample Set: Neural Network
Stock/Index: LON:NTEA NORTHERN ELECTRIC PLC
Time series to forecast n: 06 Nov 2022 for (n+6 month)

According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Buy LON:NTEA 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 NORTHERN ELECTRIC PLC

  1. A contractual cash flow characteristic does not affect the classification of the financial asset if it could have only a de minimis effect on the contractual cash flows of the financial asset. To make this determination, an entity must consider the possible effect of the contractual cash flow characteristic in each reporting period and cumulatively over the life of the financial instrument. In addition, if a contractual cash flow characteristic could have an effect on the contractual cash flows that is more than de minimis (either in a single reporting period or cumulatively) but that cash flow characteristic is not genuine, it does not affect the classification of a financial asset. A cash flow characteristic is not genuine if it affects the instrument's contractual cash flows only on the occurrence of an event that is extremely rare, highly abnormal and very unlikely to occur.
  2. When measuring the fair values of the part that continues to be recognised and the part that is derecognised for the purposes of applying paragraph 3.2.13, an entity applies the fair value measurement requirements in IFRS 13 Fair Value Measurement in addition to paragraph 3.2.14.
  3. As noted in paragraph B4.3.1, when an entity becomes a party to a hybrid contract with a host that is not an asset within the scope of this Standard and with one or more embedded derivatives, paragraph 4.3.3 requires the entity to identify any such embedded derivative, assess whether it is required to be separated from the host contract and, for those that are required to be separated, measure the derivatives at fair value at initial recognition and subsequently. These requirements can be more complex, or result in less reliable measures, than measuring the entire instrument at fair value through profit or loss. For that reason this Standard permits the entire hybrid contract to be designated as at fair value through profit or loss.
  4. For floating-rate financial assets and floating-rate financial liabilities, periodic re-estimation of cash flows to reflect the movements in the market rates of interest alters the effective interest rate. If a floating-rate financial asset or a floating-rate financial liability is recognised initially at an amount equal to the principal receivable or payable on maturity, re-estimating the future interest payments normally has no significant effect on the carrying amount of the asset or the liability.

*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

NORTHERN ELECTRIC PLC assigned short-term B2 & long-term B1 forecasted stock rating. We evaluate the prediction models Supervised Machine Learning (ML) with Lasso Regression1,2,3,4 and conclude that the LON:NTEA 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 Buy LON:NTEA stock.

Financial State Forecast for LON:NTEA NORTHERN ELECTRIC PLC Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*B2B1
Operational Risk 4345
Market Risk3147
Technical Analysis5678
Fundamental Analysis8379
Risk Unsystematic4734

Prediction Confidence Score

Trust metric by Neural Network: 75 out of 100 with 511 signals.

References

  1. V. Mnih, K. Kavukcuoglu, D. Silver, A. Rusu, J. Veness, M. Bellemare, A. Graves, M. Riedmiller, A. Fidjeland, G. Ostrovski, S. Petersen, C. Beattie, A. Sadik, I. Antonoglou, H. King, D. Kumaran, D. Wierstra, S. Legg, and D. Hassabis. Human-level control through deep reinforcement learning. Nature, 518(7540):529–533, 02 2015.
  2. Andrews, D. W. K. W. Ploberger (1994), "Optimal tests when a nuisance parameter is present only under the alternative," Econometrica, 62, 1383–1414.
  3. Athey S, Imbens GW. 2017b. The state of applied econometrics: causality and policy evaluation. J. Econ. Perspect. 31:3–32
  4. Bottou L. 2012. Stochastic gradient descent tricks. In Neural Networks: Tricks of the Trade, ed. G Montavon, G Orr, K-R Müller, pp. 421–36. Berlin: Springer
  5. V. Borkar. Q-learning for risk-sensitive control. Mathematics of Operations Research, 27:294–311, 2002.
  6. Clements, M. P. D. F. Hendry (1995), "Forecasting in cointegrated systems," Journal of Applied Econometrics, 10, 127–146.
  7. Athey S, Imbens G, Wager S. 2016a. Efficient inference of average treatment effects in high dimensions via approximate residual balancing. arXiv:1604.07125 [math.ST]
Frequently Asked QuestionsQ: What is the prediction methodology for LON:NTEA stock?
A: LON:NTEA stock prediction methodology: We evaluate the prediction models Supervised Machine Learning (ML) and Lasso Regression
Q: Is LON:NTEA stock a buy or sell?
A: The dominant strategy among neural network is to Buy LON:NTEA Stock.
Q: Is NORTHERN ELECTRIC PLC stock a good investment?
A: The consensus rating for NORTHERN ELECTRIC PLC is Buy and assigned short-term B2 & long-term B1 forecasted stock rating.
Q: What is the consensus rating of LON:NTEA stock?
A: The consensus rating for LON:NTEA is Buy.
Q: What is the prediction period for LON:NTEA stock?
A: The prediction period for LON:NTEA is (n+6 month)

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