Modelling A.I. in Economics

CSAN Cosan S.A. ADS (Forecast)

Outlook: Cosan S.A. ADS is assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Hold
Time series to forecast n: 15 May 2023 for (n+3 month)
Methodology : Modular Neural Network (Speculative Sentiment Analysis)

Abstract

Cosan S.A. ADS prediction model is evaluated with Modular Neural Network (Speculative Sentiment Analysis) and Wilcoxon Sign-Rank Test1,2,3,4 and it is concluded that the CSAN 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. What are buy sell or hold recommendations?
  2. Is it better to buy and sell or hold?
  3. What are the most successful trading algorithms?

CSAN Target Price Prediction Modeling Methodology

We consider Cosan S.A. ADS Decision Process with Modular Neural Network (Speculative Sentiment Analysis) where A is the set of discrete actions of CSAN 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(Wilcoxon Sign-Rank Test)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+3 month) e x rx

n:Time series to forecast

p:Price signals of CSAN 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?

CSAN Stock Forecast (Buy or Sell) for (n+3 month)

Sample Set: Neural Network
Stock/Index: CSAN Cosan S.A. ADS
Time series to forecast n: 15 May 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 Cosan S.A. ADS

  1. When a group of items that constitute a net position is designated as a hedged item, an entity shall designate the overall group of items that includes the items that can make up the net position. An entity is not permitted to designate a non-specific abstract amount of a net position. For example, an entity has a group of firm sale commitments in nine months' time for FC100 and a group of firm purchase commitments in 18 months' time for FC120. The entity cannot designate an abstract amount of a net position up to FC20. Instead, it must designate a gross amount of purchases and a gross amount of sales that together give rise to the hedged net position. An entity shall designate gross positions that give rise to the net position so that the entity is able to comply with the requirements for the accounting for qualifying hedging relationships.
  2. When determining whether the recognition of lifetime expected credit losses is required, an entity shall consider reasonable and supportable information that is available without undue cost or effort and that may affect the credit risk on a financial instrument in accordance with paragraph 5.5.17(c). An entity need not undertake an exhaustive search for information when determining whether credit risk has increased significantly since initial recognition.
  3. Contractual cash flows that are solely payments of principal and interest on the principal amount outstanding are consistent with a basic lending arrangement. In a basic lending arrangement, consideration for the time value of money (see paragraphs B4.1.9A–B4.1.9E) and credit risk are typically the most significant elements of interest. However, in such an arrangement, interest can also include consideration for other basic lending risks (for example, liquidity risk) and costs (for example, administrative costs) associated with holding the financial asset for a particular period of time. In addition, interest can include a profit margin that is consistent with a basic lending arrangement. In extreme economic circumstances, interest can be negative if, for example, the holder of a financial asset either explicitly or implicitly pays for the deposit of its money for a particular period of time (and that fee exceeds the consideration that the holder receives for the time value of money, credit risk and other basic lending risks and costs).
  4. Subject to the conditions in paragraphs 4.1.5 and 4.2.2, this Standard allows an entity to designate a financial asset, a financial liability, or a group of financial instruments (financial assets, financial liabilities or both) as at fair value through profit or loss provided that doing so results in more relevant information.

*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

Cosan S.A. ADS is assigned short-term Ba1 & long-term Ba1 estimated rating. Cosan S.A. ADS prediction model is evaluated with Modular Neural Network (Speculative Sentiment Analysis) and Wilcoxon Sign-Rank Test1,2,3,4 and it is concluded that the CSAN 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

CSAN Cosan S.A. ADS Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*Ba1Ba1
Income StatementBaa2Ba2
Balance SheetB3C
Leverage RatiosCBaa2
Cash FlowBa3Ba2
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: 74 out of 100 with 722 signals.

References

  1. Matzkin RL. 2007. Nonparametric identification. In Handbook of Econometrics, Vol. 6B, ed. J Heckman, E Learner, pp. 5307–68. Amsterdam: Elsevier
  2. J. Peters, S. Vijayakumar, and S. Schaal. Natural actor-critic. In Proceedings of the Sixteenth European Conference on Machine Learning, pages 280–291, 2005.
  3. Bengio Y, Schwenk H, Senécal JS, Morin F, Gauvain JL. 2006. Neural probabilistic language models. In Innovations in Machine Learning: Theory and Applications, ed. DE Holmes, pp. 137–86. Berlin: Springer
  4. Athey S, Imbens G, Wager S. 2016a. Efficient inference of average treatment effects in high dimensions via approximate residual balancing. arXiv:1604.07125 [math.ST]
  5. D. Bertsekas. Min common/max crossing duality: A geometric view of conjugacy in convex optimization. Lab. for Information and Decision Systems, MIT, Tech. Rep. Report LIDS-P-2796, 2009
  6. N. B ̈auerle and A. Mundt. Dynamic mean-risk optimization in a binomial model. Mathematical Methods of Operations Research, 70(2):219–239, 2009.
  7. Y. Chow and M. Ghavamzadeh. Algorithms for CVaR optimization in MDPs. In Advances in Neural Infor- mation Processing Systems, pages 3509–3517, 2014.
Frequently Asked QuestionsQ: What is the prediction methodology for CSAN stock?
A: CSAN stock prediction methodology: We evaluate the prediction models Modular Neural Network (Speculative Sentiment Analysis) and Wilcoxon Sign-Rank Test
Q: Is CSAN stock a buy or sell?
A: The dominant strategy among neural network is to Hold CSAN Stock.
Q: Is Cosan S.A. ADS stock a good investment?
A: The consensus rating for Cosan S.A. ADS is Hold and is assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of CSAN stock?
A: The consensus rating for CSAN is Hold.
Q: What is the prediction period for CSAN stock?
A: The prediction period for CSAN is (n+3 month)

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