Predicting long term (1 year) market performance using Predictive Analyrics

 Once is  an accident, twice is coincidence and thrice is a pattern – Alan Weiss

Predicting how markets will perform in long term over a period of year is challenging as well as difficult. There are so many possibilities of black swan events that can come up like natural disasters, wars, political unrest, economic factors like interest rates and inflations that makes it nearly impossible to predict the market for long term duration like one year time frame.

 I wanted to check how Predictive Analytics will be able to predict one year outcome. I am happy to note that using Predictive Analytics the direction of the market up or down was successful while prediction in terms of percentages was also good. I share three examples for Nifty for year (January to December) 2022, 2023 which were positive years and year 2008 which was negative close

 On 3-Jan-2022 the Nifty was 17625.7 and after a year close of 18105.3 i.e. +2.72% in a years’ time. The nearest First nearest patterns found was TSX Index of Canada on 28-Sep-1994 that was 4372.48 and after a year close of 4500.06 i.e. +2.92% in a years’ time. The second nearest pattern was found from Astra Zeneca stock of US on 23-May-2005 that was 13.39 and after a year close of 16.41 i.e. +22.56% in a years’ time.

On 2-Jan-2023 the Nifty was 18197.45 and after a year close of 21731.4 i.e. +19.42% in a years’ time. The nearest First nearest patterns found was IBM stock of US on 30-Sep-2011 that was 115.92 and after a year close of 139.75 i.e. +20.55% in a years’ time. The second nearest pattern was found from Nikkei Index of Japan on 28-Sep-1977 that was 5222.40 and after a year close of 5753.20 i.e. +10.18% in a years’ time.

On 1-Jan-2008 the Nifty was 6144.35 and after a year close of 4624.30 i.e. -24.73% in a years’ time. The nearest First nearest patterns found was 1 Month bond yield of UK 21-Mat 2007 that was 5.535 and after a year close of 5.085 i.e. -8.13% in a years’ time. The second nearest pattern was found from Dow Jones Index of US on 3-Aug-1956 that was 520.30 and after a year close of 505.10 i.e. -2.92% in a years’ time.

#predictiveanalytics #nifty #stockmarket 

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