AC Investment Research

AFI AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED Research Report

Outlook: AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Sell
Time series to forecast n: 28 Dec 2022 for (n+4 weeks)
Methodology : Modular Neural Network (Financial Sentiment Analysis)

Abstract

The stock market prediction patterns are seen as an important activity and it is more effective. Hence, stock prices will lead to lucrative profits from sound taking decisions. Because of the stagnant and noisy data, stock market-related forecasts are a major challenge for investors. Therefore, forecasting the stock market is a major challenge for investors to use their money to make more profit. Stock market predictions use mathematical strategies and learning tools.(Qiu, M. and Song, Y., 2016. Predicting the direction of stock market index movement using an optimized artificial neural network model. PloS one, 11(5), p.e0155133.) We evaluate AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED prediction models with Modular Neural Network (Financial Sentiment Analysis) and Linear Regression1,2,3,4 and conclude that the AFI stock is predictable in the short/long term. According to price forecasts for (n+4 weeks) period, the dominant strategy among neural network is: Sell

Key Points

  1. Trading Interaction
  2. Decision Making
  3. How do you know when a stock will go up or down?

AFI Target Price Prediction Modeling Methodology

We consider AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED Decision Process with Modular Neural Network (Financial Sentiment Analysis) where A is the set of discrete actions of AFI 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(Linear 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+4 weeks) r s rs

n:Time series to forecast

p:Price signals of AFI 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?

AFI Stock Forecast (Buy or Sell) for (n+4 weeks)

Sample Set: Neural Network
Stock/Index: AFI AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED
Time series to forecast n: 28 Dec 2022 for (n+4 weeks)

According to price forecasts for (n+4 weeks) period, the dominant strategy among neural network is: Sell

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 (Grey to Black): *Technical Analysis%

IFRS Reconciliation Adjustments for AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED

  1. When an entity designates a financial liability as at fair value through profit or loss, it must determine whether presenting in other comprehensive income the effects of changes in the liability's credit risk would create or enlarge an accounting mismatch in profit or loss. An accounting mismatch would be created or enlarged if presenting the effects of changes in the liability's credit risk in other comprehensive income would result in a greater mismatch in profit or loss than if those amounts were presented in profit or loss
  2. For purchased or originated credit-impaired financial assets, expected credit losses shall be discounted using the credit-adjusted effective interest rate determined at initial recognition.
  3. For the purpose of applying paragraphs B4.1.11(b) and B4.1.12(b), irrespective of the event or circumstance that causes the early termination of the contract, a party may pay or receive reasonable compensation for that early termination. For example, a party may pay or receive reasonable compensation when it chooses to terminate the contract early (or otherwise causes the early termination to occur).
  4. When applying the effective interest method, an entity generally amortises any fees, points paid or received, transaction costs and other premiums or discounts that are included in the calculation of the effective interest rate over the expected life of the financial instrument. However, a shorter period is used if this is the period to which the fees, points paid or received, transaction costs, premiums or discounts relate. This will be the case when the variable to which the fees, points paid or received, transaction costs, premiums or discounts relate is repriced to market rates before the expected maturity of the financial instrument. In such a case, the appropriate amortisation period is the period to the next such repricing date. For example, if a premium or discount on a floating-rate financial instrument reflects the interest that has accrued on that financial instrument since the interest was last paid, or changes in the market rates since the floating interest rate was reset to the market rates, it will be amortised to the next date when the floating interest is reset to market rates. This is because the premium or discount relates to the period to the next interest reset date because, at that date, the variable to which the premium or discount relates (ie interest rates) is reset to the market rates. If, however, the premium or discount results from a change in the credit spread over the floating rate specified in the financial instrument, or other variables that are not reset to the market rates, it is amortised over the expected life of the financial instrument.

*International Financial Reporting Standards (IFRS) adjustment process involves reviewing the company's financial statements and identifying any differences between the company's current accounting practices and the requirements of the IFRS. If there are any such differences, neural network makes adjustments to financial statements to bring them into compliance with the IFRS.

Conclusions

AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED assigned short-term Ba1 & long-term Ba1 estimated rating. We evaluate the prediction models Modular Neural Network (Financial Sentiment Analysis) with Linear Regression1,2,3,4 and conclude that the AFI stock is predictable in the short/long term. According to price forecasts for (n+4 weeks) period, the dominant strategy among neural network is: Sell

AFI AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*Ba1Ba1
Income StatementCaa2C
Balance SheetB1Caa2
Leverage RatiosBaa2Caa2
Cash FlowCBaa2
Rates of Return and ProfitabilityCBaa2

*Financial analysis is the process of evaluating a company's financial performance and position by neural network. It involves reviewing the company's financial statements, including the balance sheet, income statement, and cash flow statement, as well as other financial reports and documents.
How does neural network examine financial reports and understand financial state of the company?

Prediction Confidence Score

Trust metric by Neural Network: 92 out of 100 with 740 signals.

References

  1. Holland PW. 1986. Statistics and causal inference. J. Am. Stat. Assoc. 81:945–60
  2. Dimakopoulou M, Athey S, Imbens G. 2017. Estimation considerations in contextual bandits. arXiv:1711.07077 [stat.ML]
  3. V. Borkar. An actor-critic algorithm for constrained Markov decision processes. Systems & Control Letters, 54(3):207–213, 2005.
  4. D. Bertsekas. Dynamic programming and optimal control. Athena Scientific, 1995.
  5. 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.
  6. Scholkopf B, Smola AJ. 2001. Learning with Kernels: Support Vector Machines, Regularization, Optimization, and Beyond. Cambridge, MA: MIT Press
  7. Chamberlain G. 2000. Econometrics and decision theory. J. Econom. 95:255–83
Frequently Asked QuestionsQ: What is the prediction methodology for AFI stock?
A: AFI stock prediction methodology: We evaluate the prediction models Modular Neural Network (Financial Sentiment Analysis) and Linear Regression
Q: Is AFI stock a buy or sell?
A: The dominant strategy among neural network is to Sell AFI Stock.
Q: Is AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED stock a good investment?
A: The consensus rating for AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED is Sell and assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of AFI stock?
A: The consensus rating for AFI is Sell.
Q: What is the prediction period for AFI stock?
A: The prediction period for AFI is (n+4 weeks)

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