Modelling A.I. in Economics

DEM DE.MEM LIMITED (Forecast)

Outlook: DE.MEM LIMITED assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Buy
Time series to forecast n: 30 Dec 2022 for (n+3 month)
Methodology : Supervised Machine Learning (ML)

Abstract

Understanding the pattern of financial activities and predicting their development and changes are research hotspots in academic and financial circles. Because financial data contain complex, incomplete and fuzzy information, predicting their development trends is an extremely difficult challenge. Fluctuations in financial data depend on a myriad of correlated constantly changing factors. Therefore, predicting and analysing financial data are a nonlinear, time-dependent problem. Deep neural networks (DNNs) combine the advantages of deep learning (DL) and neural networks and can be used to solve nonlinear problems more satisfactorily compared to conventional machine learning algorithms.(Akhtar, M.M., Zamani, A.S., Khan, S., Shatat, A.S.A., Dilshad, S. and Samdani, F., 2022. Stock market prediction based on statistical data using machine learning algorithms. Journal of King Saud University-Science, 34(4), p.101940.) We evaluate DE.MEM LIMITED prediction models with Supervised Machine Learning (ML) and Wilcoxon Sign-Rank Test1,2,3,4 and conclude that the DEM stock is predictable in the short/long term. According to price forecasts for (n+3 month) period, the dominant strategy among neural network is: Buy

Key Points

  1. Market Risk
  2. How can neural networks improve predictions?
  3. What is neural prediction?

DEM Target Price Prediction Modeling Methodology

We consider DE.MEM LIMITED Decision Process with Supervised Machine Learning (ML) where A is the set of discrete actions of DEM 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(Wilcoxon Sign-Rank 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(Supervised Machine Learning (ML)) X S(n):→ (n+3 month) i = 1 n r i

n:Time series to forecast

p:Price signals of DEM 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?

DEM Stock Forecast (Buy or Sell) for (n+3 month)

Sample Set: Neural Network
Stock/Index: DEM DE.MEM LIMITED
Time series to forecast n: 30 Dec 2022 for (n+3 month)

According to price forecasts for (n+3 month) period, the dominant strategy among neural network is: Buy

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 DE.MEM LIMITED

  1. To make that determination, an entity must assess whether it expects that the effects of changes in the liability's credit risk will be offset in profit or loss by a change in the fair value of another financial instrument measured at fair value through profit or loss. Such an expectation must be based on an economic relationship between the characteristics of the liability and the characteristics of the other financial instrument.
  2. Paragraph 5.7.5 permits an entity to make an irrevocable election to present in other comprehensive income subsequent changes in the fair value of particular investments in equity instruments. Such an investment is not a monetary item. Accordingly, the gain or loss that is presented in other comprehensive income in accordance with paragraph 5.7.5 includes any related foreign exchange component.
  3. When designating a risk component as a hedged item, the hedge accounting requirements apply to that risk component in the same way as they apply to other hedged items that are not risk components. For example, the qualifying criteria apply, including that the hedging relationship must meet the hedge effectiveness requirements, and any hedge ineffectiveness must be measured and recognised.
  4. An entity is not required to incorporate forecasts of future conditions over the entire expected life of a financial instrument. The degree of judgement that is required to estimate expected credit losses depends on the availability of detailed information. As the forecast horizon increases, the availability of detailed information decreases and the degree of judgement required to estimate expected credit losses increases. The estimate of expected credit losses does not require a detailed estimate for periods that are far in the future—for such periods, an entity may extrapolate projections from available, detailed information.

*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

DE.MEM LIMITED assigned short-term Ba1 & long-term Ba1 estimated rating. We evaluate the prediction models Supervised Machine Learning (ML) with Wilcoxon Sign-Rank Test1,2,3,4 and conclude that the DEM stock is predictable in the short/long term. According to price forecasts for (n+3 month) period, the dominant strategy among neural network is: Buy

DEM DE.MEM LIMITED Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*Ba1Ba1
Income StatementBaa2C
Balance SheetB3Caa2
Leverage RatiosCB1
Cash FlowBa1Caa2
Rates of Return and ProfitabilityBa3C

*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: 79 out of 100 with 477 signals.

References

  1. Hill JL. 2011. Bayesian nonparametric modeling for causal inference. J. Comput. Graph. Stat. 20:217–40
  2. A. Y. Ng, D. Harada, and S. J. Russell. Policy invariance under reward transformations: Theory and application to reward shaping. In Proceedings of the Sixteenth International Conference on Machine Learning (ICML 1999), Bled, Slovenia, June 27 - 30, 1999, pages 278–287, 1999.
  3. Athey S, Tibshirani J, Wager S. 2016b. Generalized random forests. arXiv:1610.01271 [stat.ME]
  4. G. Shani, R. Brafman, and D. Heckerman. An MDP-based recommender system. In Proceedings of the Eigh- teenth conference on Uncertainty in artificial intelligence, pages 453–460. Morgan Kaufmann Publishers Inc., 2002
  5. 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
  6. M. L. Littman. Friend-or-foe q-learning in general-sum games. In Proceedings of the Eighteenth International Conference on Machine Learning (ICML 2001), Williams College, Williamstown, MA, USA, June 28 - July 1, 2001, pages 322–328, 2001
  7. Mazumder R, Hastie T, Tibshirani R. 2010. Spectral regularization algorithms for learning large incomplete matrices. J. Mach. Learn. Res. 11:2287–322
Frequently Asked QuestionsQ: What is the prediction methodology for DEM stock?
A: DEM stock prediction methodology: We evaluate the prediction models Supervised Machine Learning (ML) and Wilcoxon Sign-Rank Test
Q: Is DEM stock a buy or sell?
A: The dominant strategy among neural network is to Buy DEM Stock.
Q: Is DE.MEM LIMITED stock a good investment?
A: The consensus rating for DE.MEM LIMITED is Buy and assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of DEM stock?
A: The consensus rating for DEM is Buy.
Q: What is the prediction period for DEM stock?
A: The prediction period for DEM is (n+3 month)

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