Modelling A.I. in Economics

LON:CPI CAPITA PLC (Forecast)

Outlook: CAPITA PLC is assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Sell
Time series to forecast n: 07 Apr 2023 for (n+6 month)
Methodology : Modular Neural Network (Speculative Sentiment Analysis)

Abstract

CAPITA PLC prediction model is evaluated with Modular Neural Network (Speculative Sentiment Analysis) and Polynomial Regression1,2,3,4 and it is concluded that the LON:CPI stock is predictable in the short/long term. According to price forecasts for (n+6 month) period, the dominant strategy among neural network is: Sell

Key Points

  1. What statistical methods are used to analyze data?
  2. What are buy sell or hold recommendations?
  3. Decision Making

LON:CPI Target Price Prediction Modeling Methodology

We consider CAPITA PLC Decision Process with Modular Neural Network (Speculative Sentiment Analysis) where A is the set of discrete actions of LON:CPI 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(Polynomial 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 (Speculative Sentiment Analysis)) X S(n):→ (n+6 month) i = 1 n s i

n:Time series to forecast

p:Price signals of LON:CPI 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?

LON:CPI Stock Forecast (Buy or Sell) for (n+6 month)

Sample Set: Neural Network
Stock/Index: LON:CPI CAPITA PLC
Time series to forecast n: 07 Apr 2023 for (n+6 month)

According to price forecasts for (n+6 month) 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 CAPITA PLC

  1. However, depending on the nature of the financial instruments and the credit risk information available for particular groups of financial instruments, an entity may not be able to identify significant changes in credit risk for individual financial instruments before the financial instrument becomes past due. This may be the case for financial instruments such as retail loans for which there is little or no updated credit risk information that is routinely obtained and monitored on an individual instrument until a customer breaches the contractual terms. If changes in the credit risk for individual financial instruments are not captured before they become past due, a loss allowance based only on credit information at an individual financial instrument level would not faithfully represent the changes in credit risk since initial recognition.
  2. Measurement of a financial asset or financial liability and classification of recognised changes in its value are determined by the item's classification and whether the item is part of a designated hedging relationship. Those requirements can create a measurement or recognition inconsistency (sometimes referred to as an 'accounting mismatch') when, for example, in the absence of designation as at fair value through profit or loss, a financial asset would be classified as subsequently measured at fair value through profit or loss and a liability the entity considers related would be subsequently measured at amortised cost (with changes in fair value not recognised). In such circumstances, an entity may conclude that its financial statements would provide more relevant information if both the asset and the liability were measured as at fair value through profit or loss.
  3. For the purpose of determining whether a forecast transaction (or a component thereof) is highly probable as required by paragraph 6.3.3, an entity shall assume that the interest rate benchmark on which the hedged cash flows (contractually or non-contractually specified) are based is not altered as a result of interest rate benchmark reform.
  4. 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.

*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

CAPITA PLC is assigned short-term Ba1 & long-term Ba1 estimated rating. CAPITA PLC prediction model is evaluated with Modular Neural Network (Speculative Sentiment Analysis) and Polynomial Regression1,2,3,4 and it is concluded that the LON:CPI stock is predictable in the short/long term. According to price forecasts for (n+6 month) period, the dominant strategy among neural network is: Sell

LON:CPI CAPITA PLC Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*Ba1Ba1
Income StatementBaa2Caa2
Balance SheetBaa2B3
Leverage RatiosBa3Caa2
Cash FlowBa3C
Rates of Return and ProfitabilityBaa2Baa2

*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 496 signals.

References

  1. 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.
  2. Dudik M, Erhan D, Langford J, Li L. 2014. Doubly robust policy evaluation and optimization. Stat. Sci. 29:485–511
  3. Li L, Chu W, Langford J, Moon T, Wang X. 2012. An unbiased offline evaluation of contextual bandit algo- rithms with generalized linear models. In Proceedings of 4th ACM International Conference on Web Search and Data Mining, pp. 297–306. New York: ACM
  4. D. S. Bernstein, S. Zilberstein, and N. Immerman. The complexity of decentralized control of Markov Decision Processes. In UAI '00: Proceedings of the 16th Conference in Uncertainty in Artificial Intelligence, Stanford University, Stanford, California, USA, June 30 - July 3, 2000, pages 32–37, 2000.
  5. Wooldridge JM. 2010. Econometric Analysis of Cross Section and Panel Data. Cambridge, MA: MIT Press
  6. Chow, G. C. (1960), "Tests of equality between sets of coefficients in two linear regressions," Econometrica, 28, 591–605.
  7. Wooldridge JM. 2010. Econometric Analysis of Cross Section and Panel Data. Cambridge, MA: MIT Press
Frequently Asked QuestionsQ: What is the prediction methodology for LON:CPI stock?
A: LON:CPI stock prediction methodology: We evaluate the prediction models Modular Neural Network (Speculative Sentiment Analysis) and Polynomial Regression
Q: Is LON:CPI stock a buy or sell?
A: The dominant strategy among neural network is to Sell LON:CPI Stock.
Q: Is CAPITA PLC stock a good investment?
A: The consensus rating for CAPITA PLC is Sell and is assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of LON:CPI stock?
A: The consensus rating for LON:CPI is Sell.
Q: What is the prediction period for LON:CPI stock?
A: The prediction period for LON:CPI is (n+6 month)

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