FB data science team saw it forthcoming the age of data. They created their prophet to forecast data. While its use is not limited to stocks its a handy tool for anyone trying to understand number and movement. According to them, Prophet was made to:

FB

make it easier for experts and non-experts to make high-quality forecasts that keep up with demand

**Where Prophet shines**

Not all forecasting problems can be solved by the same procedure. Prophet is optimized for the business forecast tasks we have encountered at Facebook, which typically have any of the following characteristics:

- hourly, daily, or weekly observations with at least a few months (preferably a year) of history
- strong multiple “human-scale” seasonalities: day of week and time of year
- important holidays that occur at irregular intervals that are known in advance (e.g. the Super Bowl)
- a reasonable number of missing observations or large outliers
- historical trend changes, for instance, due to product launches or logging changes
- trends that are non-linear growth curves, where a trend hits a natural limit or saturates

**How Prophet works**

At its core, the Prophet procedure is an additive regression model with four main components:

- A piecewise linear or logistic growth curve trend. Prophet automatically detects changes in trends by selecting changepoints from the data.
- A yearly seasonal component modeled using Fourier series.
- A weekly seasonal component using dummy variables.
- A user-provided list of important holidays.

*y*(*t*) = *g*(*t*) + *s*(*t*) + *h*(*t*) + **ϵ**

*y*(

*t*) =

*g*(

*t*) +

*s*(

*t*) +

*h*(

*t*) +

- g(t) models trend, which describes a long-term increase or decrease in the data. Prophet incorporates two trend models, a saturating growth model, and a piecewise linear model, depending on the type of forecasting problem.
- s(t) models seasonality with Fourier series, which describes how data is affected by seasonal factors such as the time of the year (e.g. more searches for eggnog during the winter holidays)
- h(t) models the effects of holidays or large events that impact business time series ϵ
*.*represents an irreducible error term

#### Using Prophet in Python

#### Setup

Start by importing all the necessary libraries. If you don’t already have Prophet installed, you can easily install it with pip.

`Pip install fbprophet`

If you are getting the following error while using Jupiter

Use command

*conda install -c conda-forge fbprophet*

#### Import the packages

```
import nsepy as nse
from nsetools import Nse
import datetime
import urllib3
import random
import numpy as np
from fbprophet import Prophet
import pandas as pd
```

#### Import Stock data for analysis

```
nsel = Nse()
stock_list = nsel.get_stock_codes()
stock_list= {v: k for k, v in stock_list.items()}
Today = datetime.datetime.now()
number_of_company = int(input('En|tert the number of company:\t')) # taking the number of companies to predict
company_list =[]
for _ in range(number_of_company):
name = input('Enter the Company to Predict\t:\t')
company_list.append(name)
numbered = list(company_list)
stock_data = list(company_list)
for i in range(number_of_company):
# obtaining the data from NSE website
stock_data[i] = nse.get_history(symbol=company_list[i], start=datetime.datetime(2017,1,1), end=datetime.datetime(2019,6,13))
```

#### Fitting the data into Prophet

For Prophet to run there are two essential columns required are dy which is essentially date and y which is the value required

```
for each_stock in stock_data:
each_stock.drop(['Trades','Volume','%Deliverble','VWAP','Turnover','Last','Prev Close','Series','Symbol'], axis =1,inplace =True)
df = each_stock.sort_values('Date')
df['date'] = pd.date_range(start=datetime.datetime(2017,1,1), periods=len(df),end=datetime.datetime(2019,6,13))
df['y']=(df['High']+df['Low'])/2
df['ds']=df['date']
model = Prophet()
model.fit(df);
```

#### Let Prophet do its work

```
future = model.make_future_dataframe(periods=180) #forecasting for 1 year from now.
forecast = model.predict(future)
figure=model.plot(forecast)
fig2 = model.plot_components(forecast)
```

Here Fig2 is used to break down the output into its core compoonents

#### Output

Here the trend represents the overall trend of the stock. Weekly represents the cyclic nature in a weekly way and yearly tells us the cyclic nature in a year.

#### Full Code

```
import nsepy as nse
from nsetools import Nse
import datetime
import urllib3
import random
import numpy as np
from fbprophet import Prophet
import pandas as pd
import requests
import import_ipynb
import pre as preprocessing
import matplotlib.pyplot as plt
import tensorflow as tf
from keras.models import Sequential
from sklearn.preprocessing import MinMaxScaler
from keras.layers.recurrent import LSTM
from fbprophet.plot import plot_cross_validation_metric
from keras.layers import Dense, Dropout,Activation
from sklearn.metrics import mean_squared_error
import math
sess = requests.Session()
adapter = requests.adapters.HTTPAdapter(pool_connections=100, pool_maxsize=100)
sess.mount('http://', adapter)
resp = sess.get("http://www.nseindia.com")
nsel = Nse()
stock_list = nsel.get_stock_codes()
stock_list= {v: k for k, v in stock_list.items()}
Today = datetime.datetime.now()
number_of_company = int(input('En|tert the number of company:\t')) # taking the number of companies to predict
company_list =[]
for _ in range(number_of_company):
name = input('Enter the Company to Predict\t:\t')
company_list.append(name)
numbered = list(company_list)
stock_data = list(company_list)
for i in range(number_of_company):
# obtaining the data from NSE website
stock_data[i] = nse.get_history(symbol=company_list[i], start=datetime.datetime(2017,1,1), end=datetime.datetime(2019,6,13))
for each_stock in stock_data:
each_stock.drop(['Trades','Volume','%Deliverble','VWAP','Turnover','Last','Prev Close','Series','Symbol'], axis =1,inplace =True)
df = each_stock.sort_values('Date')
df['date'] = pd.date_range(start=datetime.datetime(2017,1,1), periods=len(df),end=datetime.datetime(2019,6,13))
df['y']=(df['High']+df['Low'])/2
df['ds']=df['date']
model = Prophet()
model.fit(df);
future = model.make_future_dataframe(periods=180) #forecasting for 1 year from now.
forecast = model.predict(future)
figure=model.plot(forecast)
fig2 = model.plot_components(forecast)
```

Many thanks for your post. I’d prefer to comment that the cost of car insurance differs from one insurance policy to another, for the reason that there are so many different facets which bring about the overall cost. For example, the model and make of the motor vehicle will have a tremendous bearing on the price tag. A reliable aged family automobile will have a less expensive premium compared to a flashy sports vehicle.

Yes, I agree when one takes into account different segment there are both event-based and historical effects. However, I would point out that using the prophet we are trying to find out the cyclicity of the data which tends to account for all the effects and it also takes into account the sudden changes by using dummy variables.