BAP Credicorp Ltd. Common Stock Stock Forecast

Credicorp Ltd. Common Stock Research Report

Summary

Nowadays, the stock market's prediction is a topic that attracted researchers in the world. Stock market prediction is a process that requires a comprehensive understanding of the data stock movement and analysis it accurately. Therefore, it needs intelligent methods to deal with this task to ensure that the prediction is as correct as possible, which will return profitable benefits to investors. The main goal of this article is the employment of effective machine learning techniques to build a strong model for stock market prediction. We evaluate Credicorp Ltd. Common Stock prediction models with Modular Neural Network (Market Volatility Analysis) and Statistical Hypothesis Testing^1,2,3,4 and conclude that the BAP stock is predictable in the short/long term. According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Buy BAP stock.

Key Points

1. What is a prediction confidence?
2. Can machine learning predict?
3. What are the most successful trading algorithms?

BAP Target Price Prediction Modeling Methodology

We consider Credicorp Ltd. Common Stock Stock Decision Process with Modular Neural Network (Market Volatility Analysis) where A is the set of discrete actions of BAP 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= $\begin{array}{cccc}{p}_{\mathrm{a}1}& p_{\mathrm{a}2}& \dots & p_{1n}\\ & ⋮\\ p_{j1}& p_{j2}& \dots & p_{jn}\\ & ⋮\\ p_{k1}& p_{k2}& \dots & p_{kn}\\ & ⋮\\ p_{n1}& p_{n2}& \dots & p_{nn}\end{array}$ X R(Modular Neural Network (Market Volatility Analysis)) X S(n):→ (n+6 month) $R=\left(\begin{array}{ccc}1& 0& 0\\ 0& 1& 0\\ 0& 0& 1\end{array}\right)$

n:Time series to forecast

p:Price signals of BAP 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?

BAP Stock Forecast (Buy or Sell) for (n+6 month)

Sample Set: Neural Network
Stock/Index: BAP Credicorp Ltd. Common Stock
Time series to forecast n: 25 Nov 2022 for (n+6 month)

According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Buy BAP stock.

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 (Yellow to Green): *Technical Analysis%

Adjusted IFRS* Prediction Methods for Credicorp Ltd. Common Stock

1. 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).
2. When applying the effective interest method, an entity generally amortises any fees, points paid or received, transaction costs and other premiums or discounts that are included in the calculation of the effective interest rate over the expected life of the financial instrument. However, a shorter period is used if this is the period to which the fees, points paid or received, transaction costs, premiums or discounts relate. This will be the case when the variable to which the fees, points paid or received, transaction costs, premiums or discounts relate is repriced to market rates before the expected maturity of the financial instrument. In such a case, the appropriate amortisation period is the period to the next such repricing date. For example, if a premium or discount on a floating-rate financial instrument reflects the interest that has accrued on that financial instrument since the interest was last paid, or changes in the market rates since the floating interest rate was reset to the market rates, it will be amortised to the next date when the floating interest is reset to market rates. This is because the premium or discount relates to the period to the next interest reset date because, at that date, the variable to which the premium or discount relates (ie interest rates) is reset to the market rates. If, however, the premium or discount results from a change in the credit spread over the floating rate specified in the financial instrument, or other variables that are not reset to the market rates, it is amortised over the expected life of the financial instrument.
3. If, at the date of initial application, it is impracticable (as defined in IAS 8) for an entity to assess a modified time value of money element in accordance with paragraphs B4.1.9B–B4.1.9D on the basis of the facts and circumstances that existed at the initial recognition of the financial asset, an entity shall assess the contractual cash flow characteristics of that financial asset on the basis of the facts and circumstances that existed at the initial recognition of the financial asset without taking into account the requirements related to the modification of the time value of money element in paragraphs B4.1.9B–B4.1.9D. (See also paragraph 42R of IFRS 7.)
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) are a set of accounting rules for the financial statements of public companies that are intended to make them consistent, transparent, and easily comparable around the world.

Conclusions

Credicorp Ltd. Common Stock assigned short-term B2 & long-term Ba3 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Market Volatility Analysis) with Statistical Hypothesis Testing^1,2,3,4 and conclude that the BAP stock is predictable in the short/long term. According to price forecasts for (n+6 month) period: The dominant strategy among neural network is to Buy BAP stock.

Financial State Forecast for BAP Credicorp Ltd. Common Stock Stock Options & Futures

Rating	Short-Term	Long-Term Senior
Outlook*	B2	Ba3
Operational Risk	58	55
Market Risk	79	48
Technical Analysis	54	62
Fundamental Analysis	38	83
Risk Unsystematic	44	75

Prediction Confidence Score

Trust metric by Neural Network: 91 out of 100 with 474 signals.

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. Bai J, Ng S. 2002. Determining the number of factors in approximate factor models. Econometrica 70:191–221
3. J. Z. Leibo, V. Zambaldi, M. Lanctot, J. Marecki, and T. Graepel. Multi-agent Reinforcement Learning in Sequential Social Dilemmas. In Proceedings of the 16th International Conference on Autonomous Agents and Multiagent Systems (AAMAS 2017), Sao Paulo, Brazil, 2017
4. Hartford J, Lewis G, Taddy M. 2016. Counterfactual prediction with deep instrumental variables networks. arXiv:1612.09596 [stat.AP]
5. Zou H, Hastie T. 2005. Regularization and variable selection via the elastic net. J. R. Stat. Soc. B 67:301–20
6. Matzkin RL. 2007. Nonparametric identification. In Handbook of Econometrics, Vol. 6B, ed. J Heckman, E Learner, pp. 5307–68. Amsterdam: Elsevier
7. D. S. Bernstein, S. Zilberstein, and N. Immerman. The complexity of decentralized control of Markov Decision Processes. In UAI '00: Proceedings of the 16th Conference in Uncertainty in Artificial Intelligence, Stanford University, Stanford, California, USA, June 30 - July 3, 2000, pages 32–37, 2000.

Frequently Asked Questions

Q: What is the prediction methodology for BAP stock?
A: BAP stock prediction methodology: We evaluate the prediction models Modular Neural Network (Market Volatility Analysis) and Statistical Hypothesis Testing
Q: Is BAP stock a buy or sell?
A: The dominant strategy among neural network is to Buy BAP Stock.
Q: Is Credicorp Ltd. Common Stock stock a good investment?
A: The consensus rating for Credicorp Ltd. Common Stock is Buy and assigned short-term B2 & long-term Ba3 forecasted stock rating.
Q: What is the consensus rating of BAP stock?
A: The consensus rating for BAP is Buy.
Q: What is the prediction period for BAP stock?
A: The prediction period for BAP is (n+6 month)