Modelling A.I. in Economics

ZNH China Southern Airlines Company Limited Common Stock

Outlook: China Southern Airlines Company Limited Common Stock assigned short-term B1 & long-term B1 forecasted stock rating.
Dominant Strategy : Wait until speculative trend diminishes
Time series to forecast n: 08 Dec 2022 for (n+6 month)
Methodology : Inductive Learning (ML)

Abstract

The search for models to predict the prices of financial markets is still a highly researched topic, despite major related challenges. The prices of financial assets are non-linear, dynamic, and chaotic; thus, they are financial time series that are difficult to predict. Among the latest techniques, machine learning models are some of the most researched, given their capabilities for recognizing complex patterns in various applications.(Pang, X., Zhou, Y., Wang, P., Lin, W. and Chang, V., 2020. An innovative neural network approach for stock market prediction. The Journal of Supercomputing, 76(3), pp.2098-2118.) We evaluate China Southern Airlines Company Limited Common Stock prediction models with Inductive Learning (ML) and ElasticNet Regression1,2,3,4 and conclude that the ZNH stock is predictable in the short/long term. According to price forecasts for (n+6 month) period, the dominant strategy among neural network is: Wait until speculative trend diminishes

Key Points

  1. Is now good time to invest?
  2. Should I buy stocks now or wait amid such uncertainty?
  3. How do you know when a stock will go up or down?

ZNH Target Price Prediction Modeling Methodology

We consider China Southern Airlines Company Limited Common Stock Decision Process with Inductive Learning (ML) where A is the set of discrete actions of ZNH 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(Inductive Learning (ML)) X S(n):→ (n+6 month) i = 1 n a i

n:Time series to forecast

p:Price signals of ZNH 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?

ZNH Stock Forecast (Buy or Sell) for (n+6 month)

Sample Set: Neural Network
Stock/Index: ZNH China Southern Airlines Company Limited Common Stock
Time series to forecast n: 08 Dec 2022 for (n+6 month)

According to price forecasts for (n+6 month) period, the dominant strategy among neural network is: Wait until speculative trend diminishes

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 China Southern Airlines Company Limited Common Stock

  1. Credit risk analysis is a multifactor and holistic analysis; whether a specific factor is relevant, and its weight compared to other factors, will depend on the type of product, characteristics of the financial instruments and the borrower as well as the geographical region. An entity shall consider reasonable and supportable information that is available without undue cost or effort and that is relevant for the particular financial instrument being assessed. However, some factors or indicators may not be identifiable on an individual financial instrument level. In such a case, the factors or indicators should be assessed for appropriate portfolios, groups of portfolios or portions of a portfolio of financial instruments to determine whether the requirement in paragraph 5.5.3 for the recognition of lifetime expected credit losses has been met.
  2. An embedded prepayment option in an interest-only or principal-only strip is closely related to the host contract provided the host contract (i) initially resulted from separating the right to receive contractual cash flows of a financial instrument that, in and of itself, did not contain an embedded derivative, and (ii) does not contain any terms not present in the original host debt contract.
  3. For the avoidance of doubt, the effects of replacing the original counterparty with a clearing counterparty and making the associated changes as described in paragraph 6.5.6 shall be reflected in the measurement of the hedging instrument and therefore in the assessment of hedge effectiveness and the measurement of hedge effectiveness
  4. If a financial instrument that was previously recognised as a financial asset is measured at fair value through profit or loss and its fair value decreases below zero, it is a financial liability measured in accordance with paragraph 4.2.1. However, hybrid contracts with hosts that are assets within the scope of this Standard are always measured in accordance with paragraph 4.3.2.

*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

China Southern Airlines Company Limited Common Stock assigned short-term B1 & long-term B1 forecasted stock rating. We evaluate the prediction models Inductive Learning (ML) with ElasticNet Regression1,2,3,4 and conclude that the ZNH stock is predictable in the short/long term. According to price forecasts for (n+6 month) period, the dominant strategy among neural network is: Wait until speculative trend diminishes

Financial State Forecast for ZNH China Southern Airlines Company Limited Common Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*B1B1
Operational Risk 4139
Market Risk8443
Technical Analysis6045
Fundamental Analysis5582
Risk Unsystematic7368

Prediction Confidence Score

Trust metric by Neural Network: 85 out of 100 with 463 signals.

References

  1. Bierens HJ. 1987. Kernel estimators of regression functions. In Advances in Econometrics: Fifth World Congress, Vol. 1, ed. TF Bewley, pp. 99–144. Cambridge, UK: Cambridge Univ. Press
  2. Meinshausen N. 2007. Relaxed lasso. Comput. Stat. Data Anal. 52:374–93
  3. Breiman L. 2001a. Random forests. Mach. Learn. 45:5–32
  4. E. van der Pol and F. A. Oliehoek. Coordinated deep reinforcement learners for traffic light control. NIPS Workshop on Learning, Inference and Control of Multi-Agent Systems, 2016.
  5. C. Claus and C. Boutilier. The dynamics of reinforcement learning in cooperative multiagent systems. In Proceedings of the Fifteenth National Conference on Artificial Intelligence and Tenth Innovative Applications of Artificial Intelligence Conference, AAAI 98, IAAI 98, July 26-30, 1998, Madison, Wisconsin, USA., pages 746–752, 1998.
  6. S. Bhatnagar. An actor-critic algorithm with function approximation for discounted cost constrained Markov decision processes. Systems & Control Letters, 59(12):760–766, 2010
  7. Hartigan JA, Wong MA. 1979. Algorithm as 136: a k-means clustering algorithm. J. R. Stat. Soc. Ser. C 28:100–8
Frequently Asked QuestionsQ: What is the prediction methodology for ZNH stock?
A: ZNH stock prediction methodology: We evaluate the prediction models Inductive Learning (ML) and ElasticNet Regression
Q: Is ZNH stock a buy or sell?
A: The dominant strategy among neural network is to Wait until speculative trend diminishes ZNH Stock.
Q: Is China Southern Airlines Company Limited Common Stock stock a good investment?
A: The consensus rating for China Southern Airlines Company Limited Common Stock is Wait until speculative trend diminishes and assigned short-term B1 & long-term B1 forecasted stock rating.
Q: What is the consensus rating of ZNH stock?
A: The consensus rating for ZNH is Wait until speculative trend diminishes.
Q: What is the prediction period for ZNH stock?
A: The prediction period for ZNH is (n+6 month)
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