Learning Hybrid Process Models From Events: Process Discovery Without Faking Confidence

Process discovery techniques return process models that are either formal (precisely describing the possible behaviors) or informal (merely a "picture" not allowing for any form of formal reasoning). Formal models are able to classify traces (i.e., sequences of events) as fitting or non-fitting. Most process mining approaches described in the literature produce such models. This is in stark contrast with the over 25 available commercial process mining tools that only discover informal process models that remain deliberately vague on the precise set of possible traces. There are two main reasons why vendors resort to such models: scalability and simplicity. In this paper, we propose to combine the best of both worlds: discovering hybrid process models that have formal and informal elements. As a proof of concept we present a discovery technique based on hybrid Petri nets. These models allow for formal reasoning, but also reveal information that cannot be captured in mainstream formal models. A novel discovery algorithm returning hybrid Petri nets has been implemented in ProM and has been applied to several real-life event logs. The results clearly demonstrate the advantages of remaining "vague" when there is not enough "evidence" in the data or standard modeling constructs do not "fit". Moreover, the approach is scalable enough to be incorporated in industrial-strength process mining tools.Comment: 25 pages, 12 figure

Correlation, price discovery and co-movement of ABS and equity

Asset-backed securitization (ABS) has become a viable and increasingly attractive risk management and refinancing method either as a standalone form of structured finance or as securitized debt in Collateralized Debt Obligations (CDO). However, the absence of industry standardization has prevented rising investment demand from translating into market liquidity comparable to traditional fixed income instruments, in all but a few selected market segments. Particularly low financial transparency and complex security designs inhibits profound analysis of secondary market pricing and how it relates to established forms of external finance. This paper represents the first attempt to measure the intertemporal, bivariate causal relationship between matched price series of equity and ABS issued by the same entity. In a two-dimensional linear system of simultaneous equations we investigate the short-term dynamics and long-term consistency of daily secondary market data from the U.K. Sterling ABS/MBS market and exchange traded shares between 1998 and 2004 with and without the presence of cointegration. Our causality framework delivers compelling empirical support for a strong co-movement between matched price series of ABS-equity pairs, where ABS markets seem to contribute more to price discovery over the long run. Controlling for cointegration, risk-free interest and average market risk of corporate debt hardly alters our results. However, once we qualify the magnitude and direction of price discovery on various security characteristics, such as the ABS asset class, we find that ABS-equity pairs with large-scale CMBS/RMBS and credit card/student loan ABS reveal stronger lead-lag relationships and joint price dynamics than whole business ABS. JEL Classifications: G10, G12, G2

An Architecture for Integrated Intelligence in Urban Management using Cloud Computing

With the emergence of new methodologies and technologies it has now become possible to manage large amounts of environmental sensing data and apply new integrated computing models to acquire information intelligence. This paper advocates the application of cloud capacity to support the information, communication and decision making needs of a wide variety of stakeholders in the complex business of the management of urban and regional development. The complexity lies in the interactions and impacts embodied in the concept of the urban-ecosystem at various governance levels. This highlights the need for more effective integrated environmental management systems. This paper offers a user-orientated approach based on requirements for an effective management of the urban-ecosystem and the potential contributions that can be supported by the cloud computing community. Furthermore, the commonality of the influence of the drivers of change at the urban level offers the opportunity for the cloud computing community to develop generic solutions that can serve the needs of hundreds of cities from Europe and indeed globally.Comment: 6 pages, 3 figure

Rare variants contribute disproportionately to quantitative trait variation in yeast.

How variants with different frequencies contribute to trait variation is a central question in genetics. We use a unique model system to disentangle the contributions of common and rare variants to quantitative traits. We generated ~14,000 progeny from crosses among 16 diverse yeast strains and identified thousands of quantitative trait loci (QTLs) for 38 traits. We combined our results with sequencing data for 1011 yeast isolates to show that rare variants make a disproportionate contribution to trait variation. Evolutionary analyses revealed that this contribution is driven by rare variants that arose recently, and that negative selection has shaped the relationship between variant frequency and effect size. We leveraged the structure of the crosses to resolve hundreds of QTLs to single genes. These results refine our understanding of trait variation at the population level and suggest that studies of rare variants are a fertile ground for discovery of genetic effects