Modelling A.I. in Economics

MFC Manulife Financial Corporation Common Stock (Forecast)

Outlook: Manulife Financial Corporation Common Stock is assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Wait until speculative trend diminishes
Time series to forecast n: 20 Jan 2023 for (n+6 month)
Methodology : Supervised Machine Learning (ML)

Abstract

Manulife Financial Corporation Common Stock prediction model is evaluated with Supervised Machine Learning (ML) and Wilcoxon Sign-Rank Test1,2,3,4 and it is concluded that the MFC 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. How can neural networks improve predictions?
  3. What is prediction model?

MFC Target Price Prediction Modeling Methodology

We consider Manulife Financial Corporation Common Stock Decision Process with Supervised Machine Learning (ML) where A is the set of discrete actions of MFC 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(Wilcoxon Sign-Rank 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(Supervised Machine Learning (ML)) X S(n):→ (n+6 month) i = 1 n r i

n:Time series to forecast

p:Price signals of MFC 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?

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

Sample Set: Neural Network
Stock/Index: MFC Manulife Financial Corporation Common Stock
Time series to forecast n: 20 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 Manulife Financial Corporation Common Stock

  1. An entity's business model refers to how an entity manages its financial assets in order to generate cash flows. That is, the entity's business model determines whether cash flows will result from collecting contractual cash flows, selling financial assets or both. Consequently, this assessment is not performed on the basis of scenarios that the entity does not reasonably expect to occur, such as so-called 'worst case' or 'stress case' scenarios. For example, if an entity expects that it will sell a particular portfolio of financial assets only in a stress case scenario, that scenario would not affect the entity's assessment of the business model for those assets if the entity reasonably expects that such a scenario will not occur. If cash flows are realised in a way that is different from the entity's expectations at the date that the entity assessed the business model (for example, if the entity sells more or fewer financial assets than it expected when it classified the assets), that does not give rise to a prior period error in the entity's financial statements (see IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors) nor does it change the classification of the remaining financial assets held in that business model (ie those assets that the entity recognised in prior periods and still holds) as long as the entity considered all relevant information that was available at the time that it made the business model assessment.
  2. If an entity originates a loan that bears an off-market interest rate (eg 5 per cent when the market rate for similar loans is 8 per cent), and receives an upfront fee as compensation, the entity recognises the loan at its fair value, ie net of the fee it receives.
  3. IFRS 15, issued in May 2014, amended paragraphs 3.1.1, 4.2.1, 5.1.1, 5.2.1, 5.7.6, B3.2.13, B5.7.1, C5 and C42 and deleted paragraph C16 and its related heading. Paragraphs 5.1.3 and 5.7.1A, and a definition to Appendix A, were added. An entity shall apply those amendments when it applies IFRS 15.
  4. A contractually specified inflation risk component of the cash flows of a recognised inflation-linked bond (assuming that there is no requirement to account for an embedded derivative separately) is separately identifiable and reliably measurable, as long as other cash flows of the instrument are not affected by the inflation risk component.

*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

Manulife Financial Corporation Common Stock is assigned short-term Ba1 & long-term Ba1 estimated rating. Manulife Financial Corporation Common Stock prediction model is evaluated with Supervised Machine Learning (ML) and Wilcoxon Sign-Rank Test1,2,3,4 and it is concluded that the MFC 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

MFC Manulife Financial Corporation Common Stock Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*Ba1Ba1
Income StatementBaa2C
Balance SheetB1B2
Leverage RatiosB1C
Cash FlowBaa2Baa2
Rates of Return and ProfitabilityB2B1

*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 545 signals.

References

  1. Athey S, Imbens G, Wager S. 2016a. Efficient inference of average treatment effects in high dimensions via approximate residual balancing. arXiv:1604.07125 [math.ST]
  2. Çetinkaya, A., Zhang, Y.Z., Hao, Y.M. and Ma, X.Y., When to Sell and When to Hold AQN Stock. AC Investment Research Journal, 101(3).
  3. Çetinkaya, A., Zhang, Y.Z., Hao, Y.M. and Ma, X.Y., Can neural networks predict stock market?(ATVI Stock Forecast). AC Investment Research Journal, 101(3).
  4. Semenova V, Goldman M, Chernozhukov V, Taddy M. 2018. Orthogonal ML for demand estimation: high dimensional causal inference in dynamic panels. arXiv:1712.09988 [stat.ML]
  5. Dimakopoulou M, Athey S, Imbens G. 2017. Estimation considerations in contextual bandits. arXiv:1711.07077 [stat.ML]
  6. Clements, M. P. D. F. Hendry (1997), "An empirical study of seasonal unit roots in forecasting," International Journal of Forecasting, 13, 341–355.
  7. Mikolov T, Sutskever I, Chen K, Corrado GS, Dean J. 2013b. Distributed representations of words and phrases and their compositionality. In Advances in Neural Information Processing Systems, Vol. 26, ed. Z Ghahramani, M Welling, C Cortes, ND Lawrence, KQ Weinberger, pp. 3111–19. San Diego, CA: Neural Inf. Process. Syst. Found.
Frequently Asked QuestionsQ: What is the prediction methodology for MFC stock?
A: MFC stock prediction methodology: We evaluate the prediction models Supervised Machine Learning (ML) and Wilcoxon Sign-Rank Test
Q: Is MFC stock a buy or sell?
A: The dominant strategy among neural network is to Wait until speculative trend diminishes MFC Stock.
Q: Is Manulife Financial Corporation Common Stock stock a good investment?
A: The consensus rating for Manulife Financial Corporation Common Stock is Wait until speculative trend diminishes and is assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of MFC stock?
A: The consensus rating for MFC is Wait until speculative trend diminishes.
Q: What is the prediction period for MFC stock?
A: The prediction period for MFC is (n+6 month)

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