Modelling A.I. in Economics

Where Will BAC^Q Stock Be in 4 Weeks?

Outlook: Bank of America Corporation Depositary shares each representing 1/1000th interest in a share of 4.250% Non-Cumulative Preferred Stock Series QQ is assigned short-term B1 & long-term B1 estimated rating.
AUC Score : What is AUC Score?
Short-Term Revised1 :
Dominant Strategy : Hold
Time series to forecast n: for Weeks2
Methodology : Modular Neural Network (Market Direction Analysis)
Hypothesis Testing : Factor
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

Bank of America Corporation Depositary shares each representing 1/1000th interest in a share of 4.250% Non-Cumulative Preferred Stock Series QQ prediction model is evaluated with Modular Neural Network (Market Direction Analysis) and Factor1,2,3,4 and it is concluded that the BAC^Q stock is predictable in the short/long term. Modular neural networks (MNNs) are a type of artificial neural network that can be used for market direction analysis. MNNs are made up of multiple smaller neural networks, called modules. Each module is responsible for learning a specific task, such as identifying patterns in data or predicting future price movements. The modules are then combined to form a single neural network that can perform multiple tasks.In the context of market direction analysis, MNNs can be used to identify patterns in market data that suggest that the market is likely to move in a particular direction. This information can then be used to make predictions about future price movements.5 According to price forecasts for 4 Weeks period, the dominant strategy among neural network is: Hold

Graph 44

Key Points

  1. Modular Neural Network (Market Direction Analysis) for BAC^Q stock price prediction process.
  2. Factor
  3. Trading Signals
  4. Is Target price a good indicator?
  5. How do you know when a stock will go up or down?

BAC^Q Stock Price Forecast

We consider Bank of America Corporation Depositary shares each representing 1/1000th interest in a share of 4.250% Non-Cumulative Preferred Stock Series QQ Decision Process with Modular Neural Network (Market Direction Analysis) where A is the set of discrete actions of BAC^Q 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


Sample Set: Neural Network
Stock/Index: BAC^Q Bank of America Corporation Depositary shares each representing 1/1000th interest in a share of 4.250% Non-Cumulative Preferred Stock Series QQ
Time series to forecast: 4 Weeks

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


F(Factor)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):→ 4 Weeks i = 1 n r i

n:Time series to forecast

p:Price signals of BAC^Q stock

j:Nash equilibria (Neural Network)

k:Dominated move of BAC^Q stock holders

a:Best response for BAC^Q target price


Modular neural networks (MNNs) are a type of artificial neural network that can be used for market direction analysis. MNNs are made up of multiple smaller neural networks, called modules. Each module is responsible for learning a specific task, such as identifying patterns in data or predicting future price movements. The modules are then combined to form a single neural network that can perform multiple tasks.In the context of market direction analysis, MNNs can be used to identify patterns in market data that suggest that the market is likely to move in a particular direction. This information can then be used to make predictions about future price movements.5 In statistics, a factor is a variable that can influence the value of another variable. Factors can be categorical or continuous. Categorical factors have a limited number of possible values, such as gender (male or female) or blood type (A, B, AB, or O). Continuous factors can have an infinite number of possible values, such as height or weight. Factors can be used to explain the variation in a dependent variable. For example, a study might find that there is a relationship between gender and height. In this case, gender would be the independent variable, height would be the dependent variable, and the factor would be gender.6,7

 

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BAC^Q Stock Forecast (Buy or Sell) Strategic Interaction Table

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 Modular Neural Network (Market Direction Analysis) based BAC^Q Stock Prediction Model

  1. However, the designation of the hedging relationship using the same hedge ratio as that resulting from the quantities of the hedged item and the hedging instrument that the entity actually uses shall not reflect an imbalance between the weightings of the hedged item and the hedging instrument that would in turn create hedge ineffectiveness (irrespective of whether recognised or not) that could result in an accounting outcome that would be inconsistent with the purpose of hedge accounting. Hence, for the purpose of designating a hedging relationship, an entity must adjust the hedge ratio that results from the quantities of the hedged item and the hedging instrument that the entity actually uses if that is needed to avoid such an imbalance
  2. If, at the date of initial application, determining whether there has been a significant increase in credit risk since initial recognition would require undue cost or effort, an entity shall recognise a loss allowance at an amount equal to lifetime expected credit losses at each reporting date until that financial instrument is derecognised (unless that financial instrument is low credit risk at a reporting date, in which case paragraph 7.2.19(a) applies).
  3. A firm commitment to acquire a business in a business combination cannot be a hedged item, except for foreign currency risk, because the other risks being hedged cannot be specifically identified and measured. Those other risks are general business risks.
  4. The risk of a default occurring on financial instruments that have comparable credit risk is higher the longer the expected life of the instrument; for example, the risk of a default occurring on an AAA-rated bond with an expected life of 10 years is higher than that on an AAA-rated bond with an expected life of five years.

*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.

BAC^Q Bank of America Corporation Depositary shares each representing 1/1000th interest in a share of 4.250% Non-Cumulative Preferred Stock Series QQ Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*B1B1
Income StatementBa1Ba2
Balance SheetBaa2C
Leverage RatiosCaa2Baa2
Cash FlowB2C
Rates of Return and ProfitabilityCB1

*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. Jorgenson, D.W., Weitzman, M.L., ZXhang, Y.X., Haxo, Y.M. and Mat, Y.X., 2023. Can Neural Networks Predict Stock Market?. AC Investment Research Journal, 220(44).
  2. Scott SL. 2010. A modern Bayesian look at the multi-armed bandit. Appl. Stoch. Models Bus. Ind. 26:639–58
  3. Bessler, D. A. S. W. Fuller (1993), "Cointegration between U.S. wheat markets," Journal of Regional Science, 33, 481–501.
  4. M. Ono, M. Pavone, Y. Kuwata, and J. Balaram. Chance-constrained dynamic programming with application to risk-aware robotic space exploration. Autonomous Robots, 39(4):555–571, 2015
  5. Athey S. 2019. The impact of machine learning on economics. In The Economics of Artificial Intelligence: An Agenda, ed. AK Agrawal, J Gans, A Goldfarb. Chicago: Univ. Chicago Press. In press
  6. Ashley, R. (1983), "On the usefulness of macroeconomic forecasts as inputs to forecasting models," Journal of Forecasting, 2, 211–223.
  7. C. Claus and C. Boutilier. The dynamics of reinforcement learning in cooperative multiagent systems. In Proceedings of the Fifteenth National Conference on Artificial Intelligence and Tenth Innovative Applications of Artificial Intelligence Conference, AAAI 98, IAAI 98, July 26-30, 1998, Madison, Wisconsin, USA., pages 746–752, 1998.
Frequently Asked QuestionsQ: Is BAC^Q stock expected to rise?
A: BAC^Q stock prediction model is evaluated with Modular Neural Network (Market Direction Analysis) and Factor and it is concluded that dominant strategy for BAC^Q stock is Hold
Q: Is BAC^Q stock a buy or sell?
A: The dominant strategy among neural network is to Hold BAC^Q Stock.
Q: Is Bank of America Corporation Depositary shares each representing 1/1000th interest in a share of 4.250% Non-Cumulative Preferred Stock Series QQ stock a good investment?
A: The consensus rating for Bank of America Corporation Depositary shares each representing 1/1000th interest in a share of 4.250% Non-Cumulative Preferred Stock Series QQ is Hold and is assigned short-term B1 & long-term B1 estimated rating.
Q: What is the consensus rating of BAC^Q stock?
A: The consensus rating for BAC^Q is Hold.
Q: What is the forecast for BAC^Q stock?
A: BAC^Q target price forecast: Hold
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