Estimation of stock prices by fuzzy logic method

Stocks are some documents which symbolize partnership and play an important role in the occurrence of economic value. Investors want to increase their savings by buying shares. In general, investors achieve profits in two ways. The first of them is the obtained revenues from dividend distribution. The other one is the obtained profit by selling a higher price than the purchasing price of the shares. Investors who want to make a profit by buying and selling of stocks, use different methods, such as technical analysis and fundamental analysis. While these methods are implemented, it is frequently used classical logic approach. This approach is based on evaluation of all events with a definite conclusion like true-false, high-low or good-bad. However, prices of stocks are affected by unlimited number of factors including uncertainties. Fuzzy logic approach has emerged as an alternative to classical logic to solve the problems, involving a variety of uncertainties. This approach is an infinitely valuable logic approach, unlike classical logic. Therefore, any topic cannot be regarded just as true or false. Each topic can be considered correct or incorrect in a certain extent. In this study, a combination of technical analysis, fundamental analysis and market anomalies was used to establish a system that gives buying and selling signals. Afterwards, the method was tested on BİST-30 companies which were selected according to various criteria. Finally, these shares were re-analyzed by a new system which was established according to the fuzzy logic approach. In the study, it was observed that the analysis, performed by the fuzzy logic approach, gives better results than the classical logic did. Besides; it was concluded that combination of the analysis methods and anomalies was more beneficial than used separately. Keywords: Stocks, Technical Analysis, Fundamental analysis, Anomalies,Fuzzy Logic