Binomial Prediction Using the Frequent Outcome Approach

Abstract

Within the context of the binomial model, we analyse sequences of values that are almost-uniform and we discuss a prediction method called the frequent outcome approach, in which the outcome that has occurred the most in the observed trials is the most likely to occur again. Using this prediction method we derive probability statements for the prior probability of correct prediction, conditional on the underlying parameter value in the binomial model. We show that this prediction method converges to a level of accuracy that is equivalent to ideal prediction based on knowledge of the model parameter.