Using Neural Networks To Forecast Stock Markets

7649 words, 31 pages

Intro Sample...


2 Motivation
There are several motivations for trying to predict stock market prices. The most basic of these is financial
gain. Any system that can consistently pick winners and losers in the dynamic market place would make the
owner of the system very wealthy. Thus, many individuals including researchers, investment professionals,
and average investors are continually looking for this superior system which will yield them high returns.
There is a second motivation in the research and financial communities. It has been proposed in the
Efficient Market Hypothesis (EMH) that markets are efficient in that opportunities for profit are discovered
so quickly that they cease to be opportunities. The EMH effectively states that no system can continually
beat the market because if this system becomes public, everyone will use it, thus negating its potential
gain. There has been an ongoing debate about the validity of the EMH, and some researchers attempted
to use neural networks to validate their claims. There has been no consensus on the EMH’s validity, but
many market observers tend to believe in its weaker forms, and thus are often unwilling to share proprietary
investment systems.
Neural networks are used to predict stock market prices because they are able to learn nonlinear mappings
between inputs and outputs. Contrary to the EMH, several researchers claim the stock market and other
complex systems exhibit chaos. Chaos is a nonlinear deterministic process which only appears random
because it can not be easily expressed. With the neural networks’ ability to learn nonlinear, chaotic systems,
it may be possible to outperform traditional analysis and other computer-based methods.
In addition to stock market prediction, neural networks have been trained to perform a variety of financial
related tasks. There are experimental and commercial systems used for track View More »

Read More

Related Essays on Using Neural Networks to Forecast Stock Markets

  • Coca Cola Marketing Mix

    9843 words, 40 pages

    Introduction The company under investigation in this study is Tim Hortons, a coffee and fresh-baked goods quick-service restaurant, originating from Canada. As of January 2006, (Annual Report 2005, P.1) Tim Hortons operated 2,597, mostly franchised, stores in Canada and 288 in the US. Tim Hortons boasts a 76% market share in the Canadian coffee and fresh-baked goods sector (Shareholder’s Report 2005, P.6) and “based on sales dollars, Tim Hortons is now almost 25% larger than its closest QSR (quick-service restaurant) competitor in Canada.” (Ibid) Since 1995, Tim Hortons has been owned by th

    View Document »

    Social Media Should Not Be Censored

    1714 words, 7 pages

    The right of free speech and the boundaries that separate it from hate speech has been an issue ever since the first social media network became public. However, in recent years the topic has become more and more heavily debated as controversial topics and social media networks efforts to censor them have become more prevalent. This debate has sparked the question of: do we as citizens believe social media networks should have the right to limit what it is we post and say on social media? The topic is far from black and white due to the possibility of horrible things being posted such as, expl

    View Document »

    Sowt Analysis

    7298 words, 30 pages

    Strategic MT Study Sheets Chapter 1 A strategy consists of competitive moves and business approaches used by managers to run the company. It is their action plan to grow the business, attract and please customers, compete successfully, conduct operations and to achieve target levels of organizational performance. It needs to appeal to customers and to help the company carve out its own market position. It uses efficiency and effectiveness to guide a company using as few resources as possible. It deals with initiatives. Strategic management is setting a company’s strategy to differe

    View Document »

    Neilsen And Uber

    1084 words, 5 pages

    UGBA161 1a. The Nielsen system at the time of the article had many apparent flaws. The first notable flaw was the fact that ratings may have been statistically wrong. The example that The Atlantic Monthly gives is the show Murphy Brown earning a rating of 15 with a standard error of sixth tenths of a ration point in either direction. The article goes on to state that these errors were merely “on paper” and that in the “real world” the degree of error may be even worse. The second big error was tracking actual viewers, especially with “button fatigue”. Many viewers would not click their but

    View Document »

    Bailout

    3077 words, 13 pages

    UGBA107 Coming into his first term as President, a huge controversial issue that President Obama had to take a stand on was whether or not to bailout American car company General Motors, as the company was strongly affected by the weak United States economy. After advocating and eventually handing out a huge bailout several years ago, General Motors is again in the spotlight because of its large amounts of investment in plants in Mexico to outsource work. Many American taxpayers believe it is wrong for General Motors to give jobs to non-Americans especially after the huge government bailou

    View Document »

    Foreign Investments In Central Asia: Past, Present, And Future

    7354 words, 30 pages

    GEO55 Introduction Since their independence in 1991 Central Asian states have each struggled to keep up with the innovations and economies of the modern world. Much of the development in each country is contingent upon the ability for countries to gain foreign investment to build infrastructure and economies. In this paper I will analyze the state of Central Asian economies as they pertain to the natural resources, infrastructure, human resources, and government in each respective state. Each of these four categories helps define the current state and the future of foreign investment i

    View Document »

    Bally Total Fitness Recommendation

    5736 words, 23 pages

    UGBA 106 Introduction The health club industry is an industry that is plagued with rapid growth and increasing competition. Clubs are struggling to stay competitive niche and emerging markets while remaining profitable. Many clubs seek multiple forms of revenue, Bally Total Fitness (Bally’s) being no exception. As one of the largest health conglomerates, Bally’s has had an interesting past riddled with successes and challenges. In the past few years, Bally’s has been largely scrutinized and has struggled to maintain positive net income and declining stock prices. This report serves as a re

    View Document »

    Anorexia Nervosa

    2544 words, 11 pages

    Anorexia Nervosa, or most commonly known as anorexia, is categorized as an eating disorder categorized by abnormally low body weight, intense fear of gaining weight and a distorted perception of body weight. According to the Diagnostic and Statistical Manual of Mental Disorders (DSM-5), the criteria needed for a person to be diagnosed with anorexia is that there needs to be a restriction of energy intake relative to requirements, leading to a significantly low body weight in the context of age, sex, developmental trajectory, and physical health. Significantly low body weight is defined as

    View Document »

    Asian Americans In The Workplace

    7576 words, 31 pages

    Asian Americans in the Workplace An In-Depth Analysis of Korean Americans 11/19/2007 ? Table of Contents Introduction 3 History of Korean Immigration to the United States 4 Values and Customs 10 Demographical Profile 16 The ‘Bamboo Ceiling’: Barriers in the Workplace 22 A Personal Interview: A Different Side to the Story 26 Conclusion 27 References 28 Introduction The term “Asian American” has a rich history in the United States. It refers to a person of Asian ancestry who also obtains American citizenship. The term was originally used by the Census Bureau to clari

    View Document »

    Regulating Broadband In Chile: The Debate Over Open Access

    2017 words, 9 pages

    UGBA101A 1. Telephone companies were given the opportunity to set their own prices unless Chile’s antitrust agency determined that there was not sufficient competition for a certain service or geographical region. As a result, the telecommunications regulatory agency, known as SUBTEL, would determine the maximum price the dominating firm could charge for the given service or region. However, firms outside of the one dominating were allowed to set any price they saw fit and could change the prices whenever they desired. The price that SUBTEL ultimately established was reliant upon assumptio

    View Document »

More Popular Essays

Research help is just moments away!