Modelling A.I. in Economics

AAL American Airlines Group Inc. Common Stock (Forecast)

Outlook: American Airlines Group Inc. Common Stock is assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Sell
Time series to forecast n: 09 May 2023 for (n+1 year)
Methodology : Modular Neural Network (Market Direction Analysis)

Abstract

American Airlines Group Inc. Common Stock prediction model is evaluated with Modular Neural Network (Market Direction Analysis) and Spearman Correlation1,2,3,4 and it is concluded that the AAL stock is predictable in the short/long term. According to price forecasts for (n+1 year) period, the dominant strategy among neural network is: Sell

Key Points

  1. What is statistical models in machine learning?
  2. Why do we need predictive models?
  3. What is Markov decision process in reinforcement learning?

AAL Target Price Prediction Modeling Methodology

We consider American Airlines Group Inc. Common Stock Decision Process with Modular Neural Network (Market Direction Analysis) where A is the set of discrete actions of AAL 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(Spearman Correlation)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 (Market Direction Analysis)) X S(n):→ (n+1 year) r s rs

n:Time series to forecast

p:Price signals of AAL 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?

AAL Stock Forecast (Buy or Sell) for (n+1 year)

Sample Set: Neural Network
Stock/Index: AAL American Airlines Group Inc. Common Stock
Time series to forecast n: 09 May 2023 for (n+1 year)

According to price forecasts for (n+1 year) 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 American Airlines Group Inc. Common Stock

  1. An entity is not required to restate prior periods to reflect the application of these amendments. The entity may restate prior periods if, and only if, it is possible without the use of hindsight and the restated financial statements reflect all the requirements in this Standard. If an entity does not restate prior periods, the entity shall recognise any difference between the previous carrying amount and the carrying amount at the beginning of the annual reporting period that includes the date of initial application of these amendments in the opening retained earnings (or other component of equity, as appropriate) of the annual reporting period that includes the date of initial application of these amendments.
  2. A portfolio of financial assets that is managed and whose performance is evaluated on a fair value basis (as described in paragraph 4.2.2(b)) is neither held to collect contractual cash flows nor held both to collect contractual cash flows and to sell financial assets. The entity is primarily focused on fair value information and uses that information to assess the assets' performance and to make decisions. In addition, a portfolio of financial assets that meets the definition of held for trading is not held to collect contractual cash flows or held both to collect contractual cash flows and to sell financial assets. For such portfolios, the collection of contractual cash flows is only incidental to achieving the business model's objective. Consequently, such portfolios of financial assets must be measured at fair value through profit or loss.
  3. If a financial instrument that was previously recognised as a financial asset is measured at fair value through profit or loss and its fair value decreases below zero, it is a financial liability measured in accordance with paragraph 4.2.1. However, hybrid contracts with hosts that are assets within the scope of this Standard are always measured in accordance with paragraph 4.3.2.
  4. If, at the date of initial application, it is impracticable (as defined in IAS 8) for an entity to assess whether the fair value of a prepayment feature was insignificant in accordance with paragraph B4.1.12(c) on the basis of the facts and circumstances that existed at the initial recognition of the financial asset, an entity shall assess the contractual cash flow characteristics of that financial asset on the basis of the facts and circumstances that existed at the initial recognition of the financial asset without taking into account the exception for prepayment features in paragraph B4.1.12. (See also paragraph 42S of IFRS 7.)

*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 Airlines Group Inc. Common Stock is assigned short-term Ba1 & long-term Ba1 estimated rating. American Airlines Group Inc. Common Stock prediction model is evaluated with Modular Neural Network (Market Direction Analysis) and Spearman Correlation1,2,3,4 and it is concluded that the AAL stock is predictable in the short/long term. According to price forecasts for (n+1 year) period, the dominant strategy among neural network is: Sell

AAL American Airlines Group Inc. Common Stock Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*Ba1Ba1
Income StatementCaa2Baa2
Balance SheetBaa2Ba3
Leverage RatiosBa2B1
Cash FlowBaa2C
Rates of Return and ProfitabilityB3Baa2

*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 856 signals.

References

  1. Bessler, D. A. T. Covey (1991), "Cointegration: Some results on U.S. cattle prices," Journal of Futures Markets, 11, 461–474.
  2. Candès EJ, Recht B. 2009. Exact matrix completion via convex optimization. Found. Comput. Math. 9:717
  3. S. Bhatnagar and K. Lakshmanan. An online actor-critic algorithm with function approximation for con- strained Markov decision processes. Journal of Optimization Theory and Applications, 153(3):688–708, 2012.
  4. Jacobs B, Donkers B, Fok D. 2014. Product Recommendations Based on Latent Purchase Motivations. Rotterdam, Neth.: ERIM
  5. H. Khalil and J. Grizzle. Nonlinear systems, volume 3. Prentice hall Upper Saddle River, 2002.
  6. Belloni A, Chernozhukov V, Hansen C. 2014. High-dimensional methods and inference on structural and treatment effects. J. Econ. Perspect. 28:29–50
  7. ZXhang, Y.X., Haxo, Y.M. and Mat, Y.X., 2023. The Dow Jones Industrial Average (No. Stock Analysis). AC Investment Research.
Frequently Asked QuestionsQ: What is the prediction methodology for AAL stock?
A: AAL stock prediction methodology: We evaluate the prediction models Modular Neural Network (Market Direction Analysis) and Spearman Correlation
Q: Is AAL stock a buy or sell?
A: The dominant strategy among neural network is to Sell AAL Stock.
Q: Is American Airlines Group Inc. Common Stock stock a good investment?
A: The consensus rating for American Airlines Group Inc. Common Stock is Sell and is assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of AAL stock?
A: The consensus rating for AAL is Sell.
Q: What is the prediction period for AAL stock?
A: The prediction period for AAL is (n+1 year)

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