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Project Documentation

The document discusses preparing a machine learning model to predict gold prices. It imports relevant libraries for data manipulation, visualization and modeling. It then describes collecting gold price data, exploring the data structure and missing values. A heatmap is constructed to understand correlations between variables like GLD, SPX and USO. Finally, the distribution of GLD prices is visualized.

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Uzair Ahmad
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16 views10 pages

Project Documentation

The document discusses preparing a machine learning model to predict gold prices. It imports relevant libraries for data manipulation, visualization and modeling. It then describes collecting gold price data, exploring the data structure and missing values. A heatmap is constructed to understand correlations between variables like GLD, SPX and USO. Finally, the distribution of GLD prices is visualized.

Uploaded by

Uzair Ahmad
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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PROJECT NAME: GOLD PRICE

PREDICTION

Group Members

Abdul Tawwab
M Rizwan
Uzair Ahmad

Importing the Libraries


 import numpy as np:
Imports the NumPy library, which is commonly used for numerical
operations and array manipulations.

 import pandas as pd:

Imports the Pandas library, which is widely used for data manipulation and
analysis. It provides data structures like DataFrames for efficient handling of
structured data.

 import matplotlib.pyplot as plt:

Imports the Matplotlib library, which is used for creating various types of
visualizations, such as plots and charts.
 import seaborn as sns:

Imports the Seaborn library, which is built on top of Matplotlib and provides
a high-level interface for drawing attractive and informative statistical
graphics.

 from sklearn.model_selection import train_test_split:

Imports the train_test_split function from scikit-learn, which is used for


splitting datasets into training and testing sets.

 from sklearn.ensemble import RandomForestRegressor:

Imports the RandomForestRegressor class from scikit-learn, which is a


machine learning model for regression tasks based on the random forest
algorithm.

 from sklearn import metrics:


Imports the metrics module from scikit-learn, which includes various
functions for evaluating the performance of machine learning models.

Data Collection and Processing


gold_data.head():

Calls the head() method on the gold_data DataFrame to display the first
five rows of the DataFrame. This is a quick way to inspect the structure and
content of the loaded data.
The
describe() method in Pandas generates descriptive statistics of the numerical
columns in a DataFrame. When applied to a DataFrame like gold_data, it provides
statistical information such as count, mean, standard deviation, minimum, 25th
percentile (Q1), median (50th percentile or Q2), 75th percentile (Q3), and
maximum for each numeric column.

By using gold_data.describe(), you get an overview of the central tendency,


dispersion, and shape of the distribution of each numeric column in the
DataFrame. This can be helpful for understanding the basic statistics of the
dataset and identifying potential outliers or patterns in the numerical data.
# number of rows and columns

gold_data.shape
The shape attribute in Pandas is used to determine the dimensions of a
DataFrame. It returns a tuple where the first element is the number of rows, and
the second element is the number of columns.

So, when you execute gold_data.shape, it will output a tuple representing the
dimensions of the DataFrame gold_data. For example, if the DataFrame has 100
rows and 5 columns, the output would be (100, 5). This
information is useful for understanding the size and

structure of the dataset.


checking the number of missing values
gold_data.isnull().sum()
gold_data.isnull(): This part of the code creates a boolean DataFrame of the same
shape as gold_data, where each element is True if the corresponding element in
gold_data is NaN (null), and False otherwise.
.sum(): This part sums up the True values along each column. Since True is treated
as 1 and False as 0 in numerical operations, the result is a Series that shows the
total number of missing values for each column.

The output will be a Series where the index represents column names, and the
values represent the count of missing values in each column. This information is
valuable for understanding the completeness of the dataset and deciding how to
handle missing values during data preprocessing.

constructing a heatmap to understand the correlatiom


plt.figure(figsize = (8,8))

sns.heatmap(correlation, cbar=True, square=True, fmt='.1f',annot=True,


annot_kws={'size':8}, cmap='plasma')
plt.figure(figsize=(8, 8)): This line creates a Matplotlib figure with a specified size
of 8x8 inches for the heatmap.

sns.heatmap(): This function from Seaborn is used to create a heatmap. It


visualizes the correlation matrix of a dataset.

correlation: It seems like the variable correlation is assumed to be a correlation


matrix (a 2D array or DataFrame) containing correlation coefficients between
different variables.

cbar=True: Displays a colorbar beside the heatmap to indicate the mapping of


colors to correlation values.

square=True: Ensures that the heatmap is square.

fmt='.1f': Formats the values in the heatmap with one decimal place.

annot=True: Displays the correlation values on the heatmap.

annot_kws={'size': 8}: Sets the size of the annotations to 8.


cmap='plasma': Specifies the color map to be used. In this case, 'plasma' is
chosen.

correlation values of GLD


print(correlation['GLD'])

correlation['GLD']: Assuming that correlation is a


DataFrame or a Series containing correlation
coefficients, this line selects the column labeled
'GLD' from the DataFrame or retrieves the correlation
values of the 'GLD' variable with all other variables.

print(): This function is used to display the selected


correlation values.

The output will be a Series or a single column


DataFrame (depending on the structure of correlation),
where the index represents the variable names, and the
values
represent
the correlation coefficients with the 'GLD' variable.

This information is valuable for understanding how


strongly each variable is correlated with the 'GLD'
variable. Positive values indicate positive
correlation, negative values indicate negative
correlation, and values closer to 0 indicate weaker
correlation.
SPX 0.049345
GLD 1.000000
USO -0.186360
SLV 0.866632
EUR/USD -0.024375
Name: GLD, dtype: float64

checking the distribution of the GLD Price


sns.distplot(gold_data['GLD'],color='green')
gold_data['GLD']: Extracts the 'GLD' column from the
gold_data DataFrame, representing the Gold prices.

sns.distplot(): This Seaborn function is used to create


a distribution plot, which combines a histogram with a
kernel density estimate (KDE) curve. It provides a
visual representation of the distribution of a
univariate dataset.

gold_data['GLD']: The variable for which the


distribution is being plotted.

color='green': Specifies the color of the plot. In this


case, the color is set to green.

The resulting plot will show the distribution of Gold


prices, helping to visualize the frequency and pattern
of different price levels. The histogram provides
information about the density of prices in various
ranges, and the KDE curve offers a smooth estimate of
the probability density function. This can be useful
for understanding the central tendency and spread of
the Gold prices in the dataset.

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