Modelling A.I. in Economics

LON:AJB AJ BELL PLC

Outlook: AJ BELL PLC is assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Hold
Time series to forecast n: 11 May 2023 for (n+3 month)
Methodology : Modular Neural Network (Speculative Sentiment Analysis)

Abstract

AJ BELL PLC prediction model is evaluated with Modular Neural Network (Speculative Sentiment Analysis) and Statistical Hypothesis Testing1,2,3,4 and it is concluded that the LON:AJB 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 is neural prediction?
  2. Should I buy stocks now or wait amid such uncertainty?
  3. What is the use of Markov decision process?

LON:AJB Target Price Prediction Modeling Methodology

We consider AJ BELL PLC Decision Process with Modular Neural Network (Speculative Sentiment Analysis) where A is the set of discrete actions of LON:AJB 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(Statistical Hypothesis Testing)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) i = 1 n r i

n:Time series to forecast

p:Price signals of LON:AJB 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:AJB Stock Forecast (Buy or Sell) for (n+3 month)

Sample Set: Neural Network
Stock/Index: LON:AJB AJ BELL PLC
Time series to forecast n: 11 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 AJ BELL PLC

  1. Hedge effectiveness is the extent to which changes in the fair value or the cash flows of the hedging instrument offset changes in the fair value or the cash flows of the hedged item (for example, when the hedged item is a risk component, the relevant change in fair value or cash flows of an item is the one that is attributable to the hedged risk). Hedge ineffectiveness is the extent to which the changes in the fair value or the cash flows of the hedging instrument are greater or less than those on the hedged item.
  2. 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.
  3. In some circumstances an entity does not have reasonable and supportable information that is available without undue cost or effort to measure lifetime expected credit losses on an individual instrument basis. In that case, lifetime expected credit losses shall be recognised on a collective basis that considers comprehensive credit risk information. This comprehensive credit risk information must incorporate not only past due information but also all relevant credit information, including forward-looking macroeconomic information, in order to approximate the result of recognising lifetime expected credit losses when there has been a significant increase in credit risk since initial recognition on an individual instrument level.
  4. An entity can also designate only changes in the cash flows or fair value of a hedged item above or below a specified price or other variable (a 'one-sided risk'). The intrinsic value of a purchased option hedging instrument (assuming that it has the same principal terms as the designated risk), but not its time value, reflects a one-sided risk in a hedged item. For example, an entity can designate the variability of future cash flow outcomes resulting from a price increase of a forecast commodity purchase. In such a situation, the entity designates only cash flow losses that result from an increase in the price above the specified level. The hedged risk does not include the time value of a purchased option, because the time value is not a component of the forecast transaction that affects profit or loss.

*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

AJ BELL PLC is assigned short-term Ba1 & long-term Ba1 estimated rating. AJ BELL PLC prediction model is evaluated with Modular Neural Network (Speculative Sentiment Analysis) and Statistical Hypothesis Testing1,2,3,4 and it is concluded that the LON:AJB 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

LON:AJB AJ BELL PLC Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*Ba1Ba1
Income StatementBaa2Baa2
Balance SheetCaa2C
Leverage RatiosBaa2B1
Cash FlowBaa2C
Rates of Return and ProfitabilityBaa2B1

*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 631 signals.

References

  1. Chen X. 2007. Large sample sieve estimation of semi-nonparametric models. In Handbook of Econometrics, Vol. 6B, ed. JJ Heckman, EE Learner, pp. 5549–632. Amsterdam: Elsevier
  2. Semenova V, Goldman M, Chernozhukov V, Taddy M. 2018. Orthogonal ML for demand estimation: high dimensional causal inference in dynamic panels. arXiv:1712.09988 [stat.ML]
  3. E. Altman. Constrained Markov decision processes, volume 7. CRC Press, 1999
  4. Athey S, Tibshirani J, Wager S. 2016b. Generalized random forests. arXiv:1610.01271 [stat.ME]
  5. Mazumder R, Hastie T, Tibshirani R. 2010. Spectral regularization algorithms for learning large incomplete matrices. J. Mach. Learn. Res. 11:2287–322
  6. Friedman JH. 2002. Stochastic gradient boosting. Comput. Stat. Data Anal. 38:367–78
  7. 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).
Frequently Asked QuestionsQ: What is the prediction methodology for LON:AJB stock?
A: LON:AJB stock prediction methodology: We evaluate the prediction models Modular Neural Network (Speculative Sentiment Analysis) and Statistical Hypothesis Testing
Q: Is LON:AJB stock a buy or sell?
A: The dominant strategy among neural network is to Hold LON:AJB Stock.
Q: Is AJ BELL PLC stock a good investment?
A: The consensus rating for AJ BELL PLC is Hold and is assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of LON:AJB stock?
A: The consensus rating for LON:AJB is Hold.
Q: What is the prediction period for LON:AJB stock?
A: The prediction period for LON:AJB is (n+3 month)

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