AEL^A American Equity Investment Life Holding Company Depositary Shares each representing a 1/1000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock Series A

Outlook: American Equity Investment Life Holding Company Depositary Shares each representing a 1/1000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock Series A is assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Hold
Time series to forecast n: 15 Mar 2023 for (n+3 month)
Methodology : Ensemble Learning (ML)

Abstract

American Equity Investment Life Holding Company Depositary Shares each representing a 1/1000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock Series A prediction model is evaluated with Ensemble Learning (ML) and Stepwise Regression^1,2,3,4 and it is concluded that the AEL^A stock is predictable in the short/long term. According to price forecasts for (n+3 month) period, the dominant strategy among neural network is: Hold

Key Points

1. Can neural networks predict stock market?
2. Buy, Sell and Hold Signals
3. How useful are statistical predictions?

AEL^A Target Price Prediction Modeling Methodology

We consider American Equity Investment Life Holding Company Depositary Shares each representing a 1/1000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock Series A Decision Process with Ensemble Learning (ML) where A is the set of discrete actions of AEL^A 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(Stepwise Regression)^5,6,7= $\begin{array}{cccc}{p}_{\mathrm{a}1}& p_{\mathrm{a}2}& \dots & p_{1n}\\ & ⋮\\ p_{j1}& p_{j2}& \dots & p_{jn}\\ & ⋮\\ p_{k1}& p_{k2}& \dots & p_{kn}\\ & ⋮\\ p_{n1}& p_{n2}& \dots & p_{nn}\end{array}$ X R(Ensemble Learning (ML)) X S(n):→ (n+3 month) $\sum _{i=1}^n\left(r_i\right)$

n:Time series to forecast

p:Price signals of AEL^A 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?

AEL^A Stock Forecast (Buy or Sell) for (n+3 month)

Sample Set: Neural Network
Stock/Index: AEL^A American Equity Investment Life Holding Company Depositary Shares each representing a 1/1000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock Series A
Time series to forecast n: 15 Mar 2023 for (n+3 month)

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

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 American Equity Investment Life Holding Company Depositary Shares each representing a 1/1000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock Series A

1. 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.
2. An entity must look through until it can identify the underlying pool of instruments that are creating (instead of passing through) the cash flows. This is the underlying pool of financial instruments.
3. An entity may use practical expedients when measuring expected credit losses if they are consistent with the principles in paragraph 5.5.17. An example of a practical expedient is the calculation of the expected credit losses on trade receivables using a provision matrix. The entity would use its historical credit loss experience (adjusted as appropriate in accordance with paragraphs B5.5.51–B5.5.52) for trade receivables to estimate the 12-month expected credit losses or the lifetime expected credit losses on the financial assets as relevant. A provision matrix might, for example, specify fixed provision rates depending on the number of days that a trade receivable is past due (for example, 1 per cent if not past due, 2 per cent if less than 30 days past due, 3 per cent if more than 30 days but less than 90 days past due, 20 per cent if 90–180 days past due etc). Depending on the diversity of its customer base, the entity would use appropriate groupings if its historical credit loss experience shows significantly different loss patterns for different customer segments. Examples of criteria that might be used to group assets include geographical region, product type, customer rating, collateral or trade credit insurance and type of customer (such as wholesale or retail)
4. Because the hedge accounting model is based on a general notion of offset between gains and losses on the hedging instrument and the hedged item, hedge effectiveness is determined not only by the economic relationship between those items (ie the changes in their underlyings) but also by the effect of credit risk on the value of both the hedging instrument and the hedged item. The effect of credit risk means that even if there is an economic relationship between the hedging instrument and the hedged item, the level of offset might become erratic. This can result from a change in the credit risk of either the hedging instrument or the hedged item that is of such a magnitude that the credit risk dominates the value changes that result from the economic relationship (ie the effect of the changes in the underlyings). A level of magnitude that gives rise to dominance is one that would result in the loss (or gain) from credit risk frustrating the effect of changes in the underlyings on the value of the hedging instrument or the hedged item, even if those changes were significant.

*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

American Equity Investment Life Holding Company Depositary Shares each representing a 1/1000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock Series A is assigned short-term Ba1 & long-term Ba1 estimated rating. American Equity Investment Life Holding Company Depositary Shares each representing a 1/1000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock Series A prediction model is evaluated with Ensemble Learning (ML) and Stepwise Regression^1,2,3,4 and it is concluded that the AEL^A stock is predictable in the short/long term. According to price forecasts for (n+3 month) period, the dominant strategy among neural network is: Hold

AEL^A American Equity Investment Life Holding Company Depositary Shares each representing a 1/1000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock Series A Financial Analysis*

Rating	Short-Term	Long-Term Senior
Outlook*	Ba1	Ba1
Income Statement	Baa2	Baa2
Balance Sheet	B2	C
Leverage Ratios	Baa2	Caa2
Cash Flow	Caa2	Baa2
Rates of Return and Profitability	Ba3	Baa2

*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: 77 out of 100 with 875 signals.

References

1. M. Puterman. Markov Decision Processes: Discrete Stochastic Dynamic Programming. Wiley, New York, 1994.
2. Breusch, T. S. A. R. Pagan (1979), "A simple test for heteroskedasticity and random coefficient variation," Econometrica, 47, 1287–1294.
3. E. Altman. Constrained Markov decision processes, volume 7. CRC Press, 1999
4. Efron B, Hastie T, Johnstone I, Tibshirani R. 2004. Least angle regression. Ann. Stat. 32:407–99
5. D. White. Mean, variance, and probabilistic criteria in finite Markov decision processes: A review. Journal of Optimization Theory and Applications, 56(1):1–29, 1988.
6. M. Babes, E. M. de Cote, and M. L. Littman. Social reward shaping in the prisoner's dilemma. In 7th International Joint Conference on Autonomous Agents and Multiagent Systems (AAMAS 2008), Estoril, Portugal, May 12-16, 2008, Volume 3, pages 1389–1392, 2008.
7. Cheung, Y. M.D. Chinn (1997), "Further investigation of the uncertain unit root in GNP," Journal of Business and Economic Statistics, 15, 68–73.

Frequently Asked Questions

Q: What is the prediction methodology for AEL^A stock?
A: AEL^A stock prediction methodology: We evaluate the prediction models Ensemble Learning (ML) and Stepwise Regression
Q: Is AEL^A stock a buy or sell?
A: The dominant strategy among neural network is to Hold AEL^A Stock.
Q: Is American Equity Investment Life Holding Company Depositary Shares each representing a 1/1000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock Series A stock a good investment?
A: The consensus rating for American Equity Investment Life Holding Company Depositary Shares each representing a 1/1000th interest in a share of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock Series A is Hold and is assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of AEL^A stock?
A: The consensus rating for AEL^A is Hold.
Q: What is the prediction period for AEL^A stock?
A: The prediction period for AEL^A is (n+3 month)

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