PAI Stock: A Sinking Ship?

Outlook: Western Asset Investment Grade Income Fund Inc. is assigned short-term B2 & long-term Ba2 estimated rating.
AUC Score : What is AUC Score?
Short-Term Revised¹ :
Dominant Strategy : Sell
Time series to forecast n: for Weeks²
Methodology : Active Learning (ML)
Hypothesis Testing : Paired T-Test
Surveillance : Major exchange and OTC

¹The accuracy of the model is being monitored on a regular basis.(15-minute period)

²Time series is updated based on short-term trends.

Summary

Western Asset Investment Grade Income Fund Inc. prediction model is evaluated with Active Learning (ML) and Paired T-Test^1,2,3,4 and it is concluded that the PAI stock is predictable in the short/long term. Active learning (AL) is a machine learning (ML) method in which the model actively queries the user for labels on data points. This allows the model to learn more efficiently, as it is only learning about the data points that are most informative. According to price forecasts for 4 Weeks period, the dominant strategy among neural network is: Sell

Key Points

1. What is prediction model?
2. What is the best way to predict stock prices?
3. Dominated Move

PAI Target Price Prediction Modeling Methodology

We consider Western Asset Investment Grade Income Fund Inc. Decision Process with Active Learning (ML) where A is the set of discrete actions of PAI 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(Paired T-Test)^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(Active Learning (ML)) X S(n):→ 4 Weeks $\begin{array}{l}\int e^x\mathrm{rx}\end{array}$

n:Time series to forecast

p:Price signals of PAI stock

j:Nash equilibria (Neural Network)

k:Dominated move

a:Best response for target price

Active Learning (ML)

Active learning (AL) is a machine learning (ML) method in which the model actively queries the user for labels on data points. This allows the model to learn more efficiently, as it is only learning about the data points that are most informative.

Paired T-Test

A paired t-test is a statistical test that compares the means of two paired samples. In a paired t-test, each data point in one sample is paired with a data point in the other sample. The pairs are typically related in some way, such as before and after measurements, or measurements from the same subject under different conditions. The paired t-test is a parametric test, which means that it assumes that the data is normally distributed. The paired t-test is also a dependent samples test, which means that the data points in each pair are correlated.

 

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?

PAI Stock Forecast (Buy or Sell)

Sample Set: Neural Network
Stock/Index: PAI Western Asset Investment Grade Income Fund Inc.
Time series to forecast: 4 Weeks

According to price forecasts, the dominant strategy among neural network is: Sell

Strategic Interaction Table Legend:

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%

Financial Data Adjustments for Active Learning (ML) based PAI Stock Prediction Model

1. The change in the value of the hedged item determined using a hypothetical derivative may also be used for the purpose of assessing whether a hedging relationship meets the hedge effectiveness requirements.
2. For the purposes of applying the requirement in paragraph 5.7.7(a), credit risk is different from asset-specific performance risk. Asset-specific performance risk is not related to the risk that an entity will fail to discharge a particular obligation but instead it is related to the risk that a single asset or a group of assets will perform poorly (or not at all).
3. The definition of a derivative in this Standard includes contracts that are settled gross by delivery of the underlying item (eg a forward contract to purchase a fixed rate debt instrument). An entity may have a contract to buy or sell a non-financial item that can be settled net in cash or another financial instrument or by exchanging financial instruments (eg a contract to buy or sell a commodity at a fixed price at a future date). Such a contract is within the scope of this Standard unless it was entered into and continues to be held for the purpose of delivery of a non-financial item in accordance with the entity's expected purchase, sale or usage requirements. However, this Standard applies to such contracts for an entity's expected purchase, sale or usage requirements if the entity makes a designation in accordance with paragraph 2.5 (see paragraphs 2.4–2.7).
4. Alternatively, the entity may base the assessment on both types of information, ie qualitative factors that are not captured through the internal ratings process and a specific internal rating category at the reporting date, taking into consideration the credit risk characteristics at initial recognition, if both types of information are relevant.

*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.

PAI Western Asset Investment Grade Income Fund Inc. Financial Analysis*

Rating	Short-Term	Long-Term Senior
Outlook*	B2	Ba2
Income Statement	Caa2	Baa2
Balance Sheet	Caa2	Ba3
Leverage Ratios	B1	C
Cash Flow	B1	Baa2
Rates of Return and Profitability	Baa2	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?

Conclusions

Western Asset Investment Grade Income Fund Inc. is assigned short-term B2 & long-term Ba2 estimated rating. Western Asset Investment Grade Income Fund Inc. prediction model is evaluated with Active Learning (ML) and Paired T-Test^1,2,3,4 and it is concluded that the PAI stock is predictable in the short/long term. According to price forecasts for 4 Weeks period, the dominant strategy among neural network is: Sell

Prediction Confidence Score

Trust metric by Neural Network: 73 out of 100 with 639 signals.

References

1. A. Shapiro, W. Tekaya, J. da Costa, and M. Soares. Risk neutral and risk averse stochastic dual dynamic programming method. European journal of operational research, 224(2):375–391, 2013
2. R. Rockafellar and S. Uryasev. Optimization of conditional value-at-risk. Journal of Risk, 2:21–42, 2000.
3. J. Baxter and P. Bartlett. Infinite-horizon policy-gradient estimation. Journal of Artificial Intelligence Re- search, 15:319–350, 2001.
4. Dietterich TG. 2000. Ensemble methods in machine learning. In Multiple Classifier Systems: First International Workshop, Cagliari, Italy, June 21–23, pp. 1–15. Berlin: Springer
5. Burkov A. 2019. The Hundred-Page Machine Learning Book. Quebec City, Can.: Andriy Burkov
6. S. Bhatnagar, R. Sutton, M. Ghavamzadeh, and M. Lee. Natural actor-critic algorithms. Automatica, 45(11): 2471–2482, 2009
7. Y. Le Tallec. Robust, risk-sensitive, and data-driven control of Markov decision processes. PhD thesis, Massachusetts Institute of Technology, 2007.

Frequently Asked Questions

Q: What is the prediction methodology for PAI stock?
A: PAI stock prediction methodology: We evaluate the prediction models Active Learning (ML) and Paired T-Test
Q: Is PAI stock a buy or sell?
A: The dominant strategy among neural network is to Sell PAI Stock.
Q: Is Western Asset Investment Grade Income Fund Inc. stock a good investment?
A: The consensus rating for Western Asset Investment Grade Income Fund Inc. is Sell and is assigned short-term B2 & long-term Ba2 estimated rating.
Q: What is the consensus rating of PAI stock?
A: The consensus rating for PAI is Sell.
Q: What is the prediction period for PAI stock?
A: The prediction period for PAI is 4 Weeks

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