Simulating future stock prices using Monte Carlo methods
Question
Using Monte Carlo methods, simulate future stock price outcomes for Apple ($AAPL) using Python. You can read more about Monte Carlo simulation (in a finance context) here.
Below is code using Python to grab the initial stock price data for Apple, to help get you started:
# Import required libraries
import math
import matplotlib.pyplot as plt
import numpy as np
from pandas_datareader import data
apple = data.DataReader('AAPL', 'yahoo',start='1/1/2009')
apple.head()
| High | Low | Open | Close | Volume | Adj Close | |
|---|---|---|---|---|---|---|
| Date | ||||||
| 2009-01-02 | 13.005714 | 12.165714 | 12.268572 | 12.964286 | 186503800.0 | 11.357091 |
| 2009-01-05 | 13.740000 | 13.244286 | 13.310000 | 13.511429 | 295402100.0 | 11.836406 |
| 2009-01-06 | 13.881429 | 13.198571 | 13.707143 | 13.288571 | 322327600.0 | 11.641174 |
| 2009-01-07 | 13.214286 | 12.894286 | 13.115714 | 13.001429 | 188262200.0 | 11.389630 |
| 2009-01-08 | 13.307143 | 12.862857 | 12.918571 | 13.242857 | 168375200.0 | 11.601127 |