Modelling A.I. in Economics

LEDS SemiLEDS Corporation Common Stock

Outlook: SemiLEDS Corporation Common Stock assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Wait until speculative trend diminishes
Time series to forecast n: 01 Jan 2023 for (n+6 month)
Methodology : Modular Neural Network (Market News Sentiment Analysis)

Abstract

In this paper, we propose a robust and novel hybrid model for prediction of stock returns. The proposed model is constituted of two linear models: autoregressive moving average model, exponential smoothing model and a non-linear model: recurrent neural network. Training data for recurrent neural network is generated by a new regression model. Recurrent neural network produces satisfactory predictions as compared to linear models. With the goal to further improve the accuracy of predictions, the proposed hybrid prediction model merges predictions obtained from these three prediction based models. (Chaigusin, S., Chirathamjaree, C. and Clayden, J., 2008, September. Soft computing in the forecasting of the stock exchange of Thailand (SET). In 2008 4th IEEE International Conference on Management of Innovation and Technology (pp. 1277-1281). IEEE.) We evaluate SemiLEDS Corporation Common Stock prediction models with Modular Neural Network (Market News Sentiment Analysis) and Multiple Regression1,2,3,4 and conclude that the LEDS 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. Can we predict stock market using machine learning?
  2. Market Outlook
  3. What is Markov decision process in reinforcement learning?

LEDS Target Price Prediction Modeling Methodology

We consider SemiLEDS Corporation Common Stock Decision Process with Modular Neural Network (Market News Sentiment Analysis) where A is the set of discrete actions of LEDS 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(Multiple 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 News Sentiment Analysis)) X S(n):→ (n+6 month) i = 1 n a i

n:Time series to forecast

p:Price signals of LEDS 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?

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

Sample Set: Neural Network
Stock/Index: LEDS SemiLEDS Corporation Common Stock
Time series to forecast n: 01 Jan 2023 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 (Grey to Black): *Technical Analysis%

IFRS Reconciliation Adjustments for SemiLEDS Corporation Common Stock

  1. For example, Entity A, whose functional currency is its local currency, has a firm commitment to pay FC150,000 for advertising expenses in nine months' time and a firm commitment to sell finished goods for FC150,000 in 15 months' time. Entity A enters into a foreign currency derivative that settles in nine months' time under which it receives FC100 and pays CU70. Entity A has no other exposures to FC. Entity A does not manage foreign currency risk on a net basis. Hence, Entity A cannot apply hedge accounting for a hedging relationship between the foreign currency derivative and a net position of FC100 (consisting of FC150,000 of the firm purchase commitment—ie advertising services—and FC149,900 (of the FC150,000) of the firm sale commitment) for a nine-month period.
  2. A single hedging instrument may be designated as a hedging instrument of more than one type of risk, provided that there is a specific designation of the hedging instrument and of the different risk positions as hedged items. Those hedged items can be in different hedging relationships.
  3. IFRS 7 defines credit risk as 'the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation'. The requirement in paragraph 5.7.7(a) relates to the risk that the issuer will fail to perform on that particular liability. It does not necessarily relate to the creditworthiness of the issuer. For example, if an entity issues a collateralised liability and a non-collateralised liability that are otherwise identical, the credit risk of those two liabilities will be different, even though they are issued by the same entity. The credit risk on the collateralised liability will be less than the credit risk of the non-collateralised liability. The credit risk for a collateralised liability may be close to zero.
  4. An entity shall assess whether contractual cash flows are solely payments of principal and interest on the principal amount outstanding for the currency in which the financial asset is denominated.

*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

SemiLEDS Corporation Common Stock assigned short-term Ba1 & long-term Ba1 estimated rating. We evaluate the prediction models Modular Neural Network (Market News Sentiment Analysis) with Multiple Regression1,2,3,4 and conclude that the LEDS 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

LEDS SemiLEDS Corporation Common Stock Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*Ba1Ba1
Income StatementCaa2B2
Balance SheetBaa2C
Leverage RatiosCCaa2
Cash FlowBaa2Baa2
Rates of Return and ProfitabilityBaa2B1

*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: 81 out of 100 with 811 signals.

References

  1. L. Prashanth and M. Ghavamzadeh. Actor-critic algorithms for risk-sensitive MDPs. In Proceedings of Advances in Neural Information Processing Systems 26, pages 252–260, 2013.
  2. Chamberlain G. 2000. Econometrics and decision theory. J. Econom. 95:255–83
  3. S. Bhatnagar, H. Prasad, and L. Prashanth. Stochastic recursive algorithms for optimization, volume 434. Springer, 2013
  4. Kallus N. 2017. Balanced policy evaluation and learning. arXiv:1705.07384 [stat.ML]
  5. Doudchenko N, Imbens GW. 2016. Balancing, regression, difference-in-differences and synthetic control methods: a synthesis. NBER Work. Pap. 22791
  6. Chernozhukov V, Escanciano JC, Ichimura H, Newey WK. 2016b. Locally robust semiparametric estimation. arXiv:1608.00033 [math.ST]
  7. 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
Frequently Asked QuestionsQ: What is the prediction methodology for LEDS stock?
A: LEDS stock prediction methodology: We evaluate the prediction models Modular Neural Network (Market News Sentiment Analysis) and Multiple Regression
Q: Is LEDS stock a buy or sell?
A: The dominant strategy among neural network is to Wait until speculative trend diminishes LEDS Stock.
Q: Is SemiLEDS Corporation Common Stock stock a good investment?
A: The consensus rating for SemiLEDS Corporation Common Stock is Wait until speculative trend diminishes and assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of LEDS stock?
A: The consensus rating for LEDS is Wait until speculative trend diminishes.
Q: What is the prediction period for LEDS stock?
A: The prediction period for LEDS is (n+6 month)



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