Forecasting of the Istanbul Stock Exchange (ISE) return with a golden ratio model in the epidemic of Covid-19

Abstract

A novel coronavirus called COVID-19 has spread rapidly all over the world in the recent days. This virus, which has become a global problem, has deeply affected the stock markets. This paper aims to present a new model based on the Golden Ratio by using the data for National 100 Index of Istanbul Stock Exchange (ISE). Having trained ISE data between 2017 and 2018, the forecasts for 2019 are made. For the first half of 2020, the data between 2018 and 2019 are trained and new forecasts are made. In the light of these forecasts, of all the compared models, our model performs better in terms of both accuracy rate and root mean square error(RMSE) values. It is already clearly seen that these results follow each other in the graphic that constitutes the forecasts of our model with the ISE data of 2020 and they are sometimes the same as well.