Prediction of stock price movement based on Markov chain prediction model
Abstract
Based on the closing price of Ping An Bank (2023/6/7-2023/7/28) 38 trading days, this paper uses Markov chain prediction
model to forecast the stock price trend of Ping An Bank in early August. By dividing the forecast objects into three states (up, fl at and down),
each state is independent of each other, using the Markov prediction method to forecast, using the initial state probability distribution and
state transfer probability matrix to predict Ping An Bank in the 39th trading day with a probability of 0.4118 to show an upward state, with a
probability of 0.5294 to show a decline state; On the 40th trading day, Ping An Bank showed a rising state with a probability of 0.451, and a
falling state with a probability of 0.475.
model to forecast the stock price trend of Ping An Bank in early August. By dividing the forecast objects into three states (up, fl at and down),
each state is independent of each other, using the Markov prediction method to forecast, using the initial state probability distribution and
state transfer probability matrix to predict Ping An Bank in the 39th trading day with a probability of 0.4118 to show an upward state, with a
probability of 0.5294 to show a decline state; On the 40th trading day, Ping An Bank showed a rising state with a probability of 0.451, and a
falling state with a probability of 0.475.
Keywords
Markov chain, stock price trend prediction, probability transfer matrix
Full Text:
PDFReferences
[1] Xiaoyang Qu. Stock Price Prediction based on Markov Chain [J]. Times Finance, 2017(8):1.
[2] Jiayao Hu,Jie Luo. Prediction of Trend distribution of fund Heavy stock index based on Markov chain [J]. Chinese Science and Technology Journal
Database (full-text Edition) Economic Management, 2022(1):3.
DOI: http://dx.doi.org/10.18686/modern-management-forum.v7i10.10686
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