Modelling A.I. in Economics

NZM NZME LIMITED (Forecast)

Outlook: NZME LIMITED is assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Sell
Time series to forecast n: 24 Feb 2023 for (n+4 weeks)
Methodology : Modular Neural Network (CNN Layer)

Abstract

NZME LIMITED prediction model is evaluated with Modular Neural Network (CNN Layer) and ElasticNet Regression1,2,3,4 and it is concluded that the NZM stock is predictable in the short/long term. According to price forecasts for (n+4 weeks) period, the dominant strategy among neural network is: Sell

Key Points

  1. Market Signals
  2. How do you know when a stock will go up or down?
  3. Is Target price a good indicator?

NZM Target Price Prediction Modeling Methodology

We consider NZME LIMITED Decision Process with Modular Neural Network (CNN Layer) where A is the set of discrete actions of NZM 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(Modular Neural Network (CNN Layer)) X S(n):→ (n+4 weeks) R = 1 0 0 0 1 0 0 0 1

n:Time series to forecast

p:Price signals of NZM 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?

NZM Stock Forecast (Buy or Sell) for (n+4 weeks)

Sample Set: Neural Network
Stock/Index: NZM NZME LIMITED
Time series to forecast n: 24 Feb 2023 for (n+4 weeks)

According to price forecasts for (n+4 weeks) period, the dominant strategy among neural network is: Sell

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 NZME LIMITED

  1. Paragraph 6.3.4 permits an entity to designate as hedged items aggregated exposures that are a combination of an exposure and a derivative. When designating such a hedged item, an entity assesses whether the aggregated exposure combines an exposure with a derivative so that it creates a different aggregated exposure that is managed as one exposure for a particular risk (or risks). In that case, the entity may designate the hedged item on the basis of the aggregated exposure
  2. This Standard does not specify a method for assessing whether a hedging relationship meets the hedge effectiveness requirements. However, an entity shall use a method that captures the relevant characteristics of the hedging relationship including the sources of hedge ineffectiveness. Depending on those factors, the method can be a qualitative or a quantitative assessment.
  3. 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.
  4. For example, an entity may use this condition to designate financial liabilities as at fair value through profit or loss if it meets the principle in paragraph 4.2.2(b) and the entity has financial assets and financial liabilities that share one or more risks and those risks are managed and evaluated on a fair value basis in accordance with a documented policy of asset and liability management. An example could be an entity that has issued 'structured products' containing multiple embedded derivatives and manages the resulting risks on a fair value basis using a mix of derivative and non-derivative financial instruments

*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

NZME LIMITED is assigned short-term Ba1 & long-term Ba1 estimated rating. NZME LIMITED prediction model is evaluated with Modular Neural Network (CNN Layer) and ElasticNet Regression1,2,3,4 and it is concluded that the NZM stock is predictable in the short/long term. According to price forecasts for (n+4 weeks) period, the dominant strategy among neural network is: Sell

NZM NZME LIMITED Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*Ba1Ba1
Income StatementBaa2Baa2
Balance SheetB3Caa2
Leverage RatiosB3Caa2
Cash FlowB1C
Rates of Return and ProfitabilityB3B3

*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: 92 out of 100 with 774 signals.

References

  1. G. Theocharous and A. Hallak. Lifetime value marketing using reinforcement learning. RLDM 2013, page 19, 2013
  2. A. Tamar and S. Mannor. Variance adjusted actor critic algorithms. arXiv preprint arXiv:1310.3697, 2013.
  3. Dudik M, Erhan D, Langford J, Li L. 2014. Doubly robust policy evaluation and optimization. Stat. Sci. 29:485–511
  4. Bai J, Ng S. 2002. Determining the number of factors in approximate factor models. Econometrica 70:191–221
  5. Çetinkaya, A., Zhang, Y.Z., Hao, Y.M. and Ma, X.Y., How do you decide buy or sell a stock?(SAIC Stock Forecast). AC Investment Research Journal, 101(3).
  6. Athey S, Bayati M, Imbens G, Zhaonan Q. 2019. Ensemble methods for causal effects in panel data settings. NBER Work. Pap. 25675
  7. Hartford J, Lewis G, Taddy M. 2016. Counterfactual prediction with deep instrumental variables networks. arXiv:1612.09596 [stat.AP]
Frequently Asked QuestionsQ: What is the prediction methodology for NZM stock?
A: NZM stock prediction methodology: We evaluate the prediction models Modular Neural Network (CNN Layer) and ElasticNet Regression
Q: Is NZM stock a buy or sell?
A: The dominant strategy among neural network is to Sell NZM Stock.
Q: Is NZME LIMITED stock a good investment?
A: The consensus rating for NZME LIMITED is Sell and is assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of NZM stock?
A: The consensus rating for NZM is Sell.
Q: What is the prediction period for NZM stock?
A: The prediction period for NZM is (n+4 weeks)

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