Forecasting on investment banking's performance Synthesis Matrix…
Forecasting on investment banking's performance
Source 6: Investigating whether target companies would refer to the forecasting result
Financial forecasting----->overconfident forecast---->-optimistic prediction----->make the firm default.
Source 5: Discriminant analysis
Source 4: The hubris model and Hypotheses development and data methodology for the budget forecasts
Source 3: Time-series forecasts, forecasts based on the Phillips curve, forecasts from the yield curve, and surveys.
Source 2: DEA model
Source 1:The root mean squared error (RMSE)
possible to recognize failing companies in advance
forecasts on future inflation
a.policymakers---->conducting monetary and fiscal policy
b.investors---->hedging the risk
c.firms---->making investment decisions and setting prices
Accurate prediction---->++ allocate investment, meet demands for transportation, manage future income and costs, solve supply chain problems and improve competitive advantages
Interest rate forecasts----> ++ financial market participants’ investment decisions.
Gathering on the specific objectives (empirical research)
Data form Market Observation Post System and Taiwan Economic Journal.
British companies at risk
203 micro and small firms operating in North West Italy
Source 2: Logistics Company
a. Three months interbank rate in the UK (LIBOR) and Germany (EURIBOR).
b. 10Y government bond yields.