Stock market prediction using the K NearestNeighbours algorithm and a comparison withthe moving average formula

Abstract: The stock market has a large impact on the economy of a nation, thisis why it is an interesting matter to see how stock market prediction canbe used and whether or not the predicted results are valid. This reportwill compare the prediction methods, the K Nearest Neighbour algorithmand the moving average formula using the closing prices of four Swedishequities that are based on the Stockholm stock exchange OMX. To geta proper familiarization into the background of stock markets and theutilized formulas, the report explains these theoretical concepts for thereader. A proper distribution of the results is given of the data with appropriatecharts and tables. Lastly a discussion explains the implicationsof the results and the conclusion that the K Nearest Neighbour algorithmproduced more accurate data when compared to the moving average formula.