When to Sell and When to Hold LUV Stock

Abstract

We evaluate Southwest Airlines prediction models with Transductive Learning (ML) and Chi-Square^1,2,3,4 and conclude that the LUV stock is predictable in the short/long term. According to price forecasts for (n+8 weeks) period: The dominant strategy among neural network is to Buy LUV stock.

Keywords: LUV, Southwest Airlines, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

1. Can we predict stock market using machine learning?
2. Is now good time to invest?
3. Which neural network is best for prediction?

LUV Target Price Prediction Modeling Methodology

We consider Southwest Airlines Stock Decision Process with Chi-Square where A is the set of discrete actions of LUV 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(Chi-Square)^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(Transductive Learning (ML)) X S(n):→ (n+8 weeks) $\sum _{i=1}^n\left(s_i\right)$

n:Time series to forecast

p:Price signals of LUV stock

j:Nash equilibria

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?

LUV Stock Forecast (Buy or Sell) for (n+8 weeks)

Sample Set: Neural Network
Stock/Index: LUV Southwest Airlines
Time series to forecast n: 06 Sep 2022 for (n+8 weeks)

According to price forecasts for (n+8 weeks) period: The dominant strategy among neural network is to Buy LUV 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%

Conclusions

Southwest Airlines assigned short-term Ba3 & long-term Ba3 forecasted stock rating. We evaluate the prediction models Transductive Learning (ML) with Chi-Square^1,2,3,4 and conclude that the LUV stock is predictable in the short/long term. According to price forecasts for (n+8 weeks) period: The dominant strategy among neural network is to Buy LUV stock.

Financial State Forecast for LUV Stock Options & Futures

Rating	Short-Term	Long-Term Senior
Outlook*	Ba3	Ba3
Operational Risk	55	34
Market Risk	78	83
Technical Analysis	90	74
Fundamental Analysis	54	58
Risk Unsystematic	50	81

Prediction Confidence Score

Trust metric by Neural Network: 92 out of 100 with 569 signals.

References

1. Krizhevsky A, Sutskever I, Hinton GE. 2012. Imagenet classification with deep convolutional neural networks. In Advances in Neural Information Processing Systems, Vol. 25, ed. Z Ghahramani, M Welling, C Cortes, ND Lawrence, KQ Weinberger, pp. 1097–105. San Diego, CA: Neural Inf. Process. Syst. Found.
2. J. Hu and M. P. Wellman. Nash q-learning for general-sum stochastic games. Journal of Machine Learning Research, 4:1039–1069, 2003.
3. R. Sutton and A. Barto. Introduction to reinforcement learning. MIT Press, 1998
4. V. Borkar. A sensitivity formula for the risk-sensitive cost and the actor-critic algorithm. Systems & Control Letters, 44:339–346, 2001
5. Vilnis L, McCallum A. 2015. Word representations via Gaussian embedding. arXiv:1412.6623 [cs.CL]
6. Morris CN. 1983. Parametric empirical Bayes inference: theory and applications. J. Am. Stat. Assoc. 78:47–55
7. Breiman L. 1996. Bagging predictors. Mach. Learn. 24:123–40

Frequently Asked Questions

Q: What is the prediction methodology for LUV stock?
A: LUV stock prediction methodology: We evaluate the prediction models Transductive Learning (ML) and Chi-Square
Q: Is LUV stock a buy or sell?
A: The dominant strategy among neural network is to Buy LUV Stock.
Q: Is Southwest Airlines stock a good investment?
A: The consensus rating for Southwest Airlines is Buy and assigned short-term Ba3 & long-term Ba3 forecasted stock rating.
Q: What is the consensus rating of LUV stock?
A: The consensus rating for LUV is Buy.
Q: What is the prediction period for LUV stock?
A: The prediction period for LUV is (n+8 weeks)