Analysis Of Walmart Stock Prices Over A Two Year Period

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The first law of forecasting is to assume the future will behave like the past .Event at that, there is a limit to how accurate the forecast can be even when using pass data. This research paper aims to forecast Walmart stock prices over a two year period. But because stock prices are more substantial when they are presented either in monthly or weekly data, the paper will be forecasting over two years but on a monthly basis i.e. Walmart stock prices is forecasted over a 24 month period.
Before we get into details about the paper, Walmart is one of the largest retail stores in the US with branches in other countries either bearing the name Walmart or some other names like Game in Nigeria. It was founded in 1962 by Sam Walton with its …show more content…

There is a lot of information out there on Walmart. A lot has been documented and others are just opinions, controversies and just almost everyone has something to say about Walmart. But the paper includes a literature review section which tries to give us a general understanding of Walmart.
Not all variables that will be used to forecast Walmart are retail stores. First, target is included in the model because it is a retail store and one of Walmart’s immediate competitors. As a customer and many other customers like me Target is usually their next store of choice after Walmart or Walmart is the next store of choice after Target. I also compare these two because in almost every other state in which you find Walmart, there is a Target.
Costco is also my next variable of choice because in as much as it’s not a traditional retail store, it’s still one of Walmart’s major competitors and there are a lot of studies out there that compares Walmart to Costco.
S&P 500 is not a retail store but a portfolio of stocks whose risk has been diversified. I.e. systematic risk of the member companies has been diversified (eliminate). And so there is less risk in their stocks. So it is included in the model because Walmart on its own bears more risk (systematic and independent risk) compared to the companies with stocks in the S&P 500.
10 year maturity rate (risk free rate) just measures the amount of risk a company has to

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