Modelling A.I. in Economics

LON:LOOP LOOPUP GROUP PLC

Buy

Hold

Sell

Speculative

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Outlook: LOOPUP GROUP PLC assigned short-term B1 & long-term B2 forecasted stock rating.
Dominant Strategy : Buy
Time series to forecast n: 06 Dec 2022 for (n+4 weeks)

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Abstract

Prediction of stock market is a long-time attractive topic to researchers from different fields. In particular, numerous studies have been conducted to predict the movement of stock market using machine learning algorithms such as support vector machine (SVM) and reinforcement learning. In this project, we propose a new prediction algorithm that exploits the temporal correlation among global stock markets and various financial products to predict the next-day stock trend.(Vachhani, H., Obiadat, M.S., Thakkar, A., Shah, V., Sojitra, R., Bhatia, J. and Tanwar, S., 2020. Machine learning based stock market analysis: A short survey. In International Conference on Innovative Data Communication Technologies and Application (pp. 12-26). Springer, Cham.) We evaluate LOOPUP GROUP PLC prediction models with Modular Neural Network (Financial Sentiment Analysis) and Independent T-Test1,2,3,4 and conclude that the LON:LOOP stock is predictable in the short/long term. According to price forecasts for (n+4 weeks) period: The dominant strategy among neural network is to Buy LON:LOOP stock.

Key Points

  1. Operational Risk
  2. Can we predict stock market using machine learning?
  3. Operational Risk

LON:LOOP Target Price Prediction Modeling Methodology

We consider LOOPUP GROUP PLC Decision Process with Modular Neural Network (Financial Sentiment Analysis) where A is the set of discrete actions of LON:LOOP 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 (Financial Sentiment Analysis)) X S(n):→ (n+4 weeks) S = s 1 s 2 s 3

n:Time series to forecast

p:Price signals of LON:LOOP 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?

LON:LOOP Stock Forecast (Buy or Sell) for (n+4 weeks)

Sample Set: Neural Network
Stock/Index: LON:LOOP LOOPUP GROUP PLC
Time series to forecast n: 06 Dec 2022 for (n+4 weeks)

According to price forecasts for (n+4 weeks) period: The dominant strategy among neural network is to Buy LON:LOOP 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 LOOPUP GROUP PLC

  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. For example, an entity hedges an exposure to Foreign Currency A using a currency derivative that references Foreign Currency B and Foreign Currencies A and B are pegged (ie their exchange rate is maintained within a band or at an exchange rate set by a central bank or other authority). If the exchange rate between Foreign Currency A and Foreign Currency B were changed (ie a new band or rate was set), rebalancing the hedging relationship to reflect the new exchange rate would ensure that the hedging relationship would continue to meet the hedge effectiveness requirement for the hedge ratio in the new circumstances. In contrast, if there was a default on the currency derivative, changing the hedge ratio could not ensure that the hedging relationship would continue to meet that hedge effectiveness requirement. Hence, rebalancing does not facilitate the continuation of a hedging relationship in situations in which the relationship between the hedging instrument and the hedged item changes in a way that cannot be compensated for by adjusting the hedge ratio
  3. In applying the effective interest method, an entity identifies fees that are an integral part of the effective interest rate of a financial instrument. The description of fees for financial services may not be indicative of the nature and substance of the services provided. Fees that are an integral part of the effective interest rate of a financial instrument are treated as an adjustment to the effective interest rate, unless the financial instrument is measured at fair value, with the change in fair value being recognised in profit or loss. In those cases, the fees are recognised as revenue or expense when the instrument is initially recognised.
  4. Rebalancing refers to the adjustments made to the designated quantities of the hedged item or the hedging instrument of an already existing hedging relationship for the purpose of maintaining a hedge ratio that complies with the hedge effectiveness requirements. Changes to designated quantities of a hedged item or of a hedging instrument for a different purpose do not constitute rebalancing for the purpose of this Standard

*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

LOOPUP GROUP PLC assigned short-term B1 & long-term B2 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Financial Sentiment Analysis) with Independent T-Test1,2,3,4 and conclude that the LON:LOOP stock is predictable in the short/long term. According to price forecasts for (n+4 weeks) period: The dominant strategy among neural network is to Buy LON:LOOP stock.

Financial State Forecast for LON:LOOP LOOPUP GROUP PLC Options & Futures

Rating Short-Term Long-Term Senior
Outlook*B1B2
Operational Risk 5752
Market Risk6641
Technical Analysis4649
Fundamental Analysis6548
Risk Unsystematic7252

Prediction Confidence Score

Trust metric by Neural Network: 83 out of 100 with 851 signals.

References

  1. V. Borkar and R. Jain. Risk-constrained Markov decision processes. IEEE Transaction on Automatic Control, 2014
  2. Keane MP. 2013. Panel data discrete choice models of consumer demand. In The Oxford Handbook of Panel Data, ed. BH Baltagi, pp. 54–102. Oxford, UK: Oxford Univ. Press
  3. Mullainathan S, Spiess J. 2017. Machine learning: an applied econometric approach. J. Econ. Perspect. 31:87–106
  4. Alpaydin E. 2009. Introduction to Machine Learning. Cambridge, MA: MIT Press
  5. D. Bertsekas. Nonlinear programming. Athena Scientific, 1999.
  6. Wu X, Kumar V, Quinlan JR, Ghosh J, Yang Q, et al. 2008. Top 10 algorithms in data mining. Knowl. Inform. Syst. 14:1–37
  7. Chen, C. L. Liu (1993), "Joint estimation of model parameters and outlier effects in time series," Journal of the American Statistical Association, 88, 284–297.
Frequently Asked QuestionsQ: What is the prediction methodology for LON:LOOP stock?
A: LON:LOOP stock prediction methodology: We evaluate the prediction models Modular Neural Network (Financial Sentiment Analysis) and Independent T-Test
Q: Is LON:LOOP stock a buy or sell?
A: The dominant strategy among neural network is to Buy LON:LOOP Stock.
Q: Is LOOPUP GROUP PLC stock a good investment?
A: The consensus rating for LOOPUP GROUP PLC is Buy and assigned short-term B1 & long-term B2 forecasted stock rating.
Q: What is the consensus rating of LON:LOOP stock?
A: The consensus rating for LON:LOOP is Buy.
Q: What is the prediction period for LON:LOOP stock?
A: The prediction period for LON:LOOP is (n+4 weeks)



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