Outlook: FIRST REPUBLIC BANK Depositary Shares Each Representing a 1/40th Interest in a Share of 4.70% Noncumulative Perpetual Series J Preferred Stock is assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Buy
Time series to forecast n: 27 Feb 2023 for (n+3 month)
Methodology : Transfer Learning (ML)

## Abstract

FIRST REPUBLIC BANK Depositary Shares Each Representing a 1/40th Interest in a Share of 4.70% Noncumulative Perpetual Series J Preferred Stock prediction model is evaluated with Transfer Learning (ML) and Statistical Hypothesis Testing1,2,3,4 and it is concluded that the FRC^J stock is predictable in the short/long term. According to price forecasts for (n+3 month) period, the dominant strategy among neural network is: Buy

## Key Points

1. Can we predict stock market using machine learning?
2. Technical Analysis with Algorithmic Trading
3. Game Theory

## FRC^J Target Price Prediction Modeling Methodology

We consider FIRST REPUBLIC BANK Depositary Shares Each Representing a 1/40th Interest in a Share of 4.70% Noncumulative Perpetual Series J Preferred Stock Decision Process with Transfer Learning (ML) where A is the set of discrete actions of FRC^J 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(Statistical Hypothesis Testing)5,6,7= $\begin{array}{cccc}{p}_{a1}& {p}_{a2}& \dots & {p}_{1n}\\ & ⋮\\ {p}_{j1}& {p}_{j2}& \dots & {p}_{jn}\\ & ⋮\\ {p}_{k1}& {p}_{k2}& \dots & {p}_{kn}\\ & ⋮\\ {p}_{n1}& {p}_{n2}& \dots & {p}_{nn}\end{array}$ X R(Transfer Learning (ML)) X S(n):→ (n+3 month) $\stackrel{\to }{R}=\left({r}_{1},{r}_{2},{r}_{3}\right)$

n:Time series to forecast

p:Price signals of FRC^J 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?

## FRC^J Stock Forecast (Buy or Sell) for (n+3 month)

Sample Set: Neural Network
Stock/Index: FRC^J FIRST REPUBLIC BANK Depositary Shares Each Representing a 1/40th Interest in a Share of 4.70% Noncumulative Perpetual Series J Preferred Stock
Time series to forecast n: 27 Feb 2023 for (n+3 month)

According to price forecasts for (n+3 month) period, the dominant strategy among neural network is: Buy

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 FIRST REPUBLIC BANK Depositary Shares Each Representing a 1/40th Interest in a Share of 4.70% Noncumulative Perpetual Series J Preferred Stock

1. Rebalancing is accounted for as a continuation of the hedging relationship in accordance with paragraphs B6.5.9–B6.5.21. On rebalancing, the hedge ineffectiveness of the hedging relationship is determined and recognised immediately before adjusting the hedging relationship.
2. Adjusting the hedge ratio allows an entity to respond to changes in the relationship between the hedging instrument and the hedged item that arise from their underlyings or risk variables. For example, a hedging relationship in which the hedging instrument and the hedged item have different but related underlyings changes in response to a change in the relationship between those two underlyings (for example, different but related reference indices, rates or prices). Hence, rebalancing allows the continuation of a hedging relationship in situations in which the relationship between the hedging instrument and the hedged item chang
3. To the extent that a transfer of a financial asset does not qualify for derecognition, the transferee does not recognise the transferred asset as its asset. The transferee derecognises the cash or other consideration paid and recognises a receivable from the transferor. If the transferor has both a right and an obligation to reacquire control of the entire transferred asset for a fixed amount (such as under a repurchase agreement), the transferee may measure its receivable at amortised cost if it meets the criteria in paragraph 4.1.2.
4. If a variable-rate financial liability bears interest of (for example) three-month LIBOR minus 20 basis points (with a floor at zero basis points), an entity can designate as the hedged item the change in the cash flows of that entire liability (ie three-month LIBOR minus 20 basis points—including the floor) that is attributable to changes in LIBOR. Hence, as long as the three-month LIBOR forward curve for the remaining life of that liability does not fall below 20 basis points, the hedged item has the same cash flow variability as a liability that bears interest at three-month LIBOR with a zero or positive spread. However, if the three-month LIBOR forward curve for the remaining life of that liability (or a part of it) falls below 20 basis points, the hedged item has a lower cash flow variability than a liability that bears interest at threemonth LIBOR with a zero or positive spread.

*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

FIRST REPUBLIC BANK Depositary Shares Each Representing a 1/40th Interest in a Share of 4.70% Noncumulative Perpetual Series J Preferred Stock is assigned short-term Ba1 & long-term Ba1 estimated rating. FIRST REPUBLIC BANK Depositary Shares Each Representing a 1/40th Interest in a Share of 4.70% Noncumulative Perpetual Series J Preferred Stock prediction model is evaluated with Transfer Learning (ML) and Statistical Hypothesis Testing1,2,3,4 and it is concluded that the FRC^J stock is predictable in the short/long term. According to price forecasts for (n+3 month) period, the dominant strategy among neural network is: Buy

### FRC^J FIRST REPUBLIC BANK Depositary Shares Each Representing a 1/40th Interest in a Share of 4.70% Noncumulative Perpetual Series J Preferred Stock Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*Ba1Ba1
Income StatementCaa2Baa2
Balance SheetBaa2Ba3
Leverage RatiosB1Ba3
Cash FlowCC
Rates of Return and ProfitabilityBaa2C

*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: 82 out of 100 with 549 signals.

## References

1. Friedberg R, Tibshirani J, Athey S, Wager S. 2018. Local linear forests. arXiv:1807.11408 [stat.ML]
2. Kitagawa T, Tetenov A. 2015. Who should be treated? Empirical welfare maximization methods for treatment choice. Tech. Rep., Cent. Microdata Methods Pract., Inst. Fiscal Stud., London
3. Andrews, D. W. K. W. Ploberger (1994), "Optimal tests when a nuisance parameter is present only under the alternative," Econometrica, 62, 1383–1414.
4. G. Theocharous and A. Hallak. Lifetime value marketing using reinforcement learning. RLDM 2013, page 19, 2013
5. Abadir, K. M., K. Hadri E. Tzavalis (1999), "The influence of VAR dimensions on estimator biases," Econometrica, 67, 163–181.
6. A. Eck, L. Soh, S. Devlin, and D. Kudenko. Potential-based reward shaping for finite horizon online POMDP planning. Autonomous Agents and Multi-Agent Systems, 30(3):403–445, 2016
7. N. B ̈auerle and A. Mundt. Dynamic mean-risk optimization in a binomial model. Mathematical Methods of Operations Research, 70(2):219–239, 2009.
Frequently Asked QuestionsQ: What is the prediction methodology for FRC^J stock?
A: FRC^J stock prediction methodology: We evaluate the prediction models Transfer Learning (ML) and Statistical Hypothesis Testing
Q: Is FRC^J stock a buy or sell?
A: The dominant strategy among neural network is to Buy FRC^J Stock.
Q: Is FIRST REPUBLIC BANK Depositary Shares Each Representing a 1/40th Interest in a Share of 4.70% Noncumulative Perpetual Series J Preferred Stock stock a good investment?
A: The consensus rating for FIRST REPUBLIC BANK Depositary Shares Each Representing a 1/40th Interest in a Share of 4.70% Noncumulative Perpetual Series J Preferred Stock is Buy and is assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of FRC^J stock?
A: The consensus rating for FRC^J is Buy.
Q: What is the prediction period for FRC^J stock?
A: The prediction period for FRC^J is (n+3 month)
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