Modelling A.I. in Economics

ENA ENSURANCE LTD (Forecast)

Outlook: ENSURANCE LTD assigned short-term B2 & long-term Baa2 forecasted stock rating.
Dominant Strategy : Hold
Time series to forecast n: 12 Dec 2022 for (n+8 weeks)
Methodology : Modular Neural Network (Speculative Sentiment Analysis)

Abstract

In this paper, we propose a hybrid machine learning system based on Genetic Algor ithm (GA) and Support Vector Machines (SVM) for stock market prediction. A variety of indicators from the technical analysis field of study are used as input features. We also make use of the correlation between stock prices of different companies to forecast the price of a stock, making use of technical indicators of highly correlated stocks, not only the stock to be predicted. The genetic algorithm is used to select the set of most informative input features from among all the technical indicators.(Mokhtari, S., Yen, K.K. and Liu, J., 2021. Effectiveness of artificial intelligence in stock market prediction based on machine learning. arXiv preprint arXiv:2107.01031.) We evaluate ENSURANCE LTD prediction models with Modular Neural Network (Speculative Sentiment Analysis) and Independent T-Test1,2,3,4 and conclude that the ENA stock is predictable in the short/long term. According to price forecasts for (n+8 weeks) period, the dominant strategy among neural network is: Hold

Key Points

  1. Game Theory
  2. Trading Interaction
  3. What is prediction model?

ENA Target Price Prediction Modeling Methodology

We consider ENSURANCE LTD Decision Process with Modular Neural Network (Speculative Sentiment Analysis) where A is the set of discrete actions of ENA 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= 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 (Speculative Sentiment Analysis)) X S(n):→ (n+8 weeks) R = 1 0 0 0 1 0 0 0 1

n:Time series to forecast

p:Price signals of ENA 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?

ENA Stock Forecast (Buy or Sell) for (n+8 weeks)

Sample Set: Neural Network
Stock/Index: ENA ENSURANCE LTD
Time series to forecast n: 12 Dec 2022 for (n+8 weeks)

According to price forecasts for (n+8 weeks) period, the dominant strategy among neural network is: Hold

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%

Adjusted IFRS* Prediction Methods for ENSURANCE LTD

  1. If there are changes in circumstances that affect hedge effectiveness, an entity may have to change the method for assessing whether a hedging relationship meets the hedge effectiveness requirements in order to ensure that the relevant characteristics of the hedging relationship, including the sources of hedge ineffectiveness, are still captured.
  2. If the group of items does not have any offsetting risk positions (for example, a group of foreign currency expenses that affect different line items in the statement of profit or loss and other comprehensive income that are hedged for foreign currency risk) then the reclassified hedging instrument gains or losses shall be apportioned to the line items affected by the hedged items. This apportionment shall be done on a systematic and rational basis and shall not result in the grossing up of the net gains or losses arising from a single hedging instrument.
  3. An entity's documentation of the hedging relationship includes how it will assess the hedge effectiveness requirements, including the method or methods used. The documentation of the hedging relationship shall be updated for any changes to the methods (see paragraph B6.4.17).
  4. Paragraph 4.1.1(b) requires an entity to classify a financial asset on the basis of its contractual cash flow characteristics if the financial asset is held within a business model whose objective is to hold assets to collect contractual cash flows or within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, unless paragraph 4.1.5 applies. To do so, the condition in paragraphs 4.1.2(b) and 4.1.2A(b) requires an entity to determine whether the asset's contractual cash flows are solely payments of principal and interest on the principal amount outstanding.

*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

ENSURANCE LTD assigned short-term B2 & long-term Baa2 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Speculative Sentiment Analysis) with Independent T-Test1,2,3,4 and conclude that the ENA stock is predictable in the short/long term. According to price forecasts for (n+8 weeks) period, the dominant strategy among neural network is: Hold

Financial State Forecast for ENA ENSURANCE LTD Options & Futures

Rating Short-Term Long-Term Senior
Outlook*B2Baa2
Operational Risk 5290
Market Risk5383
Technical Analysis6468
Fundamental Analysis4454
Risk Unsystematic7084

Prediction Confidence Score

Trust metric by Neural Network: 80 out of 100 with 838 signals.

References

  1. Athey S, Tibshirani J, Wager S. 2016b. Generalized random forests. arXiv:1610.01271 [stat.ME]
  2. Dietterich TG. 2000. Ensemble methods in machine learning. In Multiple Classifier Systems: First International Workshop, Cagliari, Italy, June 21–23, pp. 1–15. Berlin: Springer
  3. Blei DM, Lafferty JD. 2009. Topic models. In Text Mining: Classification, Clustering, and Applications, ed. A Srivastava, M Sahami, pp. 101–24. Boca Raton, FL: CRC Press
  4. M. J. Hausknecht. Cooperation and Communication in Multiagent Deep Reinforcement Learning. PhD thesis, The University of Texas at Austin, 2016
  5. S. Bhatnagar, R. Sutton, M. Ghavamzadeh, and M. Lee. Natural actor-critic algorithms. Automatica, 45(11): 2471–2482, 2009
  6. N. B ̈auerle and A. Mundt. Dynamic mean-risk optimization in a binomial model. Mathematical Methods of Operations Research, 70(2):219–239, 2009.
  7. 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
Frequently Asked QuestionsQ: What is the prediction methodology for ENA stock?
A: ENA stock prediction methodology: We evaluate the prediction models Modular Neural Network (Speculative Sentiment Analysis) and Independent T-Test
Q: Is ENA stock a buy or sell?
A: The dominant strategy among neural network is to Hold ENA Stock.
Q: Is ENSURANCE LTD stock a good investment?
A: The consensus rating for ENSURANCE LTD is Hold and assigned short-term B2 & long-term Baa2 forecasted stock rating.
Q: What is the consensus rating of ENA stock?
A: The consensus rating for ENA is Hold.
Q: What is the prediction period for ENA stock?
A: The prediction period for ENA is (n+8 weeks)

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