Modelling A.I. in Economics

HUMAW Humacyte Inc. Warrant (Forecast)

Outlook: Humacyte Inc. Warrant assigned short-term Caa2 & long-term B1 forecasted stock rating.
Dominant Strategy : Hold
Time series to forecast n: 09 Dec 2022 for (n+4 weeks)
Methodology : Modular Neural Network (Market Volatility Analysis)

Abstract

The success of portfolio construction depends primarily on the future performance of stock markets. Recent developments in machine learning have brought significant opportunities to incorporate prediction theory into portfolio selection. However, many studies show that a single prediction model is insufficient to achieve very accurate predictions and affluent returns. In this paper, a novel portfolio construction approach is developed using a hybrid model based on machine learning for stock prediction.(Ampomah, E.K., Nyame, G., Qin, Z., Addo, P.C., Gyamfi, E.O. and Gyan, M., 2021. Stock market prediction with gaussian naïve bayes machine learning algorithm. Informatica, 45(2).) We evaluate Humacyte Inc. Warrant prediction models with Modular Neural Network (Market Volatility Analysis) and ElasticNet Regression1,2,3,4 and conclude that the HUMAW stock is predictable in the short/long term. According to price forecasts for (n+4 weeks) period, the dominant strategy among neural network is: Hold

Key Points

  1. Market Risk
  2. What is the use of Markov decision process?
  3. How do you decide buy or sell a stock?

HUMAW Target Price Prediction Modeling Methodology

We consider Humacyte Inc. Warrant Decision Process with Modular Neural Network (Market Volatility Analysis) where A is the set of discrete actions of HUMAW 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(ElasticNet 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 (Market Volatility Analysis)) X S(n):→ (n+4 weeks) R = 1 0 0 0 1 0 0 0 1

n:Time series to forecast

p:Price signals of HUMAW 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?

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

Sample Set: Neural Network
Stock/Index: HUMAW Humacyte Inc. Warrant
Time series to forecast n: 09 Dec 2022 for (n+4 weeks)

According to price forecasts for (n+4 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 (Yellow to Green): *Technical Analysis%

Adjusted IFRS* Prediction Methods for Humacyte Inc. Warrant

  1. Although the objective of an entity's business model may be to hold financial assets in order to collect contractual cash flows, the entity need not hold all of those instruments until maturity. Thus an entity's business model can be to hold financial assets to collect contractual cash flows even when sales of financial assets occur or are expected to occur in the future.
  2. However, in some cases, the time value of money element may be modified (ie imperfect). That would be the case, for example, if a financial asset's interest rate is periodically reset but the frequency of that reset does not match the tenor of the interest rate (for example, the interest rate resets every month to a one-year rate) or if a financial asset's interest rate is periodically reset to an average of particular short- and long-term interest rates. In such cases, an entity must assess the modification to determine whether the contractual cash flows represent solely payments of principal and interest on the principal amount outstanding. In some circumstances, the entity may be able to make that determination by performing a qualitative assessment of the time value of money element whereas, in other circumstances, it may be necessary to perform a quantitative assessment.
  3. When assessing a modified time value of money element, an entity must consider factors that could affect future contractual cash flows. For example, if an entity is assessing a bond with a five-year term and the variable interest rate is reset every six months to a five-year rate, the entity cannot conclude that the contractual cash flows are solely payments of principal and interest on the principal amount outstanding simply because the interest rate curve at the time of the assessment is such that the difference between a five-year interest rate and a six-month interest rate is not significant. Instead, the entity must also consider whether the relationship between the five-year interest rate and the six-month interest rate could change over the life of the instrument such that the contractual (undiscounted) cash flows over the life of the instrument could be significantly different from the (undiscounted) benchmark cash flows. However, an entity must consider only reasonably possible scenarios instead of every possible scenario. If an entity concludes that the contractual (undiscounted) cash flows could be significantly different from the (undiscounted) benchmark cash flows, the financial asset does not meet the condition in paragraphs 4.1.2(b) and 4.1.2A(b) and therefore cannot be measured at amortised cost or fair value through other comprehensive income.
  4. An entity shall apply this Standard for annual periods beginning on or after 1 January 2018. Earlier application is permitted. If an entity elects to apply this Standard early, it must disclose that fact and apply all of the requirements in this Standard at the same time (but see also paragraphs 7.1.2, 7.2.21 and 7.3.2). It shall also, at the same time, apply the amendments in Appendix C.

*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

Humacyte Inc. Warrant assigned short-term Caa2 & long-term B1 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Market Volatility Analysis) with ElasticNet Regression1,2,3,4 and conclude that the HUMAW stock is predictable in the short/long term. According to price forecasts for (n+4 weeks) period, the dominant strategy among neural network is: Hold

Financial State Forecast for HUMAW Humacyte Inc. Warrant Options & Futures

Rating Short-Term Long-Term Senior
Outlook*Caa2B1
Operational Risk 5359
Market Risk3558
Technical Analysis4062
Fundamental Analysis6361
Risk Unsystematic3458

Prediction Confidence Score

Trust metric by Neural Network: 81 out of 100 with 861 signals.

References

  1. K. Tuyls and G. Weiss. Multiagent learning: Basics, challenges, and prospects. AI Magazine, 33(3): 41–52, 2012
  2. Zou H, Hastie T. 2005. Regularization and variable selection via the elastic net. J. R. Stat. Soc. B 67:301–20
  3. Vilnis L, McCallum A. 2015. Word representations via Gaussian embedding. arXiv:1412.6623 [cs.CL]
  4. Bottomley, P. R. Fildes (1998), "The role of prices in models of innovation diffusion," Journal of Forecasting, 17, 539–555.
  5. A. Shapiro, W. Tekaya, J. da Costa, and M. Soares. Risk neutral and risk averse stochastic dual dynamic programming method. European journal of operational research, 224(2):375–391, 2013
  6. Friedberg R, Tibshirani J, Athey S, Wager S. 2018. Local linear forests. arXiv:1807.11408 [stat.ML]
  7. V. Konda and J. Tsitsiklis. Actor-Critic algorithms. In Proceedings of Advances in Neural Information Processing Systems 12, pages 1008–1014, 2000
Frequently Asked QuestionsQ: What is the prediction methodology for HUMAW stock?
A: HUMAW stock prediction methodology: We evaluate the prediction models Modular Neural Network (Market Volatility Analysis) and ElasticNet Regression
Q: Is HUMAW stock a buy or sell?
A: The dominant strategy among neural network is to Hold HUMAW Stock.
Q: Is Humacyte Inc. Warrant stock a good investment?
A: The consensus rating for Humacyte Inc. Warrant is Hold and assigned short-term Caa2 & long-term B1 forecasted stock rating.
Q: What is the consensus rating of HUMAW stock?
A: The consensus rating for HUMAW is Hold.
Q: What is the prediction period for HUMAW stock?
A: The prediction period for HUMAW is (n+4 weeks)

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