Modelling A.I. in Economics

Should You Buy Now or Wait? LON:POLR Stock Forecast

Outlook: POLAR CAPITAL HOLDINGS PLC is assigned short-term Ba3 & long-term B2 estimated rating.
AUC Score : What is AUC Score?
Short-Term Revised1 :
Dominant Strategy : Sell
Time series to forecast n: for Weeks2
Methodology : Statistical Inference (ML)
Hypothesis Testing : Sign 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.


POLAR CAPITAL HOLDINGS PLC prediction model is evaluated with Statistical Inference (ML) and Sign Test1,2,3,4 and it is concluded that the LON:POLR stock is predictable in the short/long term. Statistical inference is a process of drawing conclusions about a population based on data from a sample of that population. In machine learning (ML), statistical inference is used to make predictions about new data based on data that has already been seen. According to price forecasts for 6 Month period, the dominant strategy among neural network is: Sell

Graph 49

Key Points

  1. Prediction Modeling
  2. What is statistical models in machine learning?
  3. Should I buy stocks now or wait amid such uncertainty?

LON:POLR Target Price Prediction Modeling Methodology

We consider POLAR CAPITAL HOLDINGS PLC Decision Process with Statistical Inference (ML) where A is the set of discrete actions of LON:POLR 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(Sign 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(Statistical Inference (ML)) X S(n):→ 6 Month r s rs

n:Time series to forecast

p:Price signals of LON:POLR stock

j:Nash equilibria (Neural Network)

k:Dominated move

a:Best response for target price

Statistical Inference (ML)

Statistical inference is a process of drawing conclusions about a population based on data from a sample of that population. In machine learning (ML), statistical inference is used to make predictions about new data based on data that has already been seen.

Sign Test

The sign test is a non-parametric hypothesis test that is used to compare two paired samples. In a paired sample, 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 sign test is a non-parametric test, which means that it does not assume that the data is normally distributed. The sign 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?

LON:POLR Stock Forecast (Buy or Sell)

Sample Set: Neural Network
Stock/Index: LON:POLR POLAR CAPITAL HOLDINGS PLC
Time series to forecast: 6 Month

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 Statistical Inference (ML) based LON:POLR Stock Prediction Model

  1. The following example describes a situation in which an accounting mismatch would be created in profit or loss if the effects of changes in the credit risk of the liability were presented in other comprehensive income. A mortgage bank provides loans to customers and funds those loans by selling bonds with matching characteristics (eg amount outstanding, repayment profile, term and currency) in the market. The contractual terms of the loan permit the mortgage customer to prepay its loan (ie satisfy its obligation to the bank) by buying the corresponding bond at fair value in the market and delivering that bond to the mortgage bank. As a result of that contractual prepayment right, if the credit quality of the bond worsens (and, thus, the fair value of the mortgage bank's liability decreases), the fair value of the mortgage bank's loan asset also decreases. The change in the fair value of the asset reflects the mortgage customer's contractual right to prepay the mortgage loan by buying the underlying bond at fair value (which, in this example, has decreased) and delivering the bond to the mortgage bank. Consequently, the effects of changes in the credit risk of the liability (the bond) will be offset in profit or loss by a corresponding change in the fair value of a financial asset (the loan). If the effects of changes in the liability's credit risk were presented in other comprehensive income there would be an accounting mismatch in profit or loss. Consequently, the mortgage bank is required to present all changes in fair value of the liability (including the effects of changes in the liability's credit risk) in profit or loss.
  2. The underlying pool must contain one or more instruments that have contractual cash flows that are solely payments of principal and interest on the principal amount outstanding
  3. One of the defining characteristics of a derivative is that it has an initial net investment that is smaller than would be required for other types of contracts that would be expected to have a similar response to changes in market factors. An option contract meets that definition because the premium is less than the investment that would be required to obtain the underlying financial instrument to which the option is linked. A currency swap that requires an initial exchange of different currencies of equal fair values meets the definition because it has a zero initial net investment.
  4. If, in applying paragraph 7.2.44, an entity reinstates a discontinued hedging relationship, the entity shall read references in paragraphs 6.9.11 and 6.9.12 to the date the alternative benchmark rate is designated as a noncontractually specified risk component for the first time as referring to the date of initial application of these amendments (ie the 24-month period for that alternative benchmark rate designated as a non-contractually specified risk component begins from the date of initial application of these amendments).

*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.

LON:POLR POLAR CAPITAL HOLDINGS PLC Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*Ba3B2
Income StatementBaa2B2
Balance SheetBaa2Caa2
Leverage RatiosCCaa2
Cash FlowBa2C
Rates of Return and ProfitabilityCBa1

*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?

References

  1. Dudik M, Langford J, Li L. 2011. Doubly robust policy evaluation and learning. In Proceedings of the 28th International Conference on Machine Learning, pp. 1097–104. La Jolla, CA: Int. Mach. Learn. Soc.
  2. Rumelhart DE, Hinton GE, Williams RJ. 1986. Learning representations by back-propagating errors. Nature 323:533–36
  3. Bell RM, Koren Y. 2007. Lessons from the Netflix prize challenge. ACM SIGKDD Explor. Newsl. 9:75–79
  4. S. Proper and K. Tumer. Modeling difference rewards for multiagent learning (extended abstract). In Proceedings of the Eleventh International Joint Conference on Autonomous Agents and Multiagent Systems, Valencia, Spain, June 2012
  5. LeCun Y, Bengio Y, Hinton G. 2015. Deep learning. Nature 521:436–44
  6. Breiman L, Friedman J, Stone CJ, Olshen RA. 1984. Classification and Regression Trees. Boca Raton, FL: CRC Press
  7. Efron B, Hastie T. 2016. Computer Age Statistical Inference, Vol. 5. Cambridge, UK: Cambridge Univ. Press
Frequently Asked QuestionsQ: What is the prediction methodology for LON:POLR stock?
A: LON:POLR stock prediction methodology: We evaluate the prediction models Statistical Inference (ML) and Sign Test
Q: Is LON:POLR stock a buy or sell?
A: The dominant strategy among neural network is to Sell LON:POLR Stock.
Q: Is POLAR CAPITAL HOLDINGS PLC stock a good investment?
A: The consensus rating for POLAR CAPITAL HOLDINGS PLC is Sell and is assigned short-term Ba3 & long-term B2 estimated rating.
Q: What is the consensus rating of LON:POLR stock?
A: The consensus rating for LON:POLR is Sell.
Q: What is the prediction period for LON:POLR stock?
A: The prediction period for LON:POLR is 6 Month

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