Artificial Intelligence & Machine Learning in Finance: A literature review

In the 2020s, Artificial Intelligence (AI) has been increasingly becoming a dominant technology, and thanks to new computer technologies, Machine Learning (ML) has also experienced remarkable growth in recent years; however, Artificial Intelligence (AI) needs notable data scientist and engineers’ innovation to evolve. Hence, in this paper, we aim to infer the intellectual development of AI and ML in finance research, adopting a scoping review combined with an embedded review to pursue and scrutinize the services of these concepts. For a technical literature review, we goose-step the five stages of the scoping review methodology along with Donthu et al.’s (2021) bibliometric review method. This article highlights the trends in AI and ML applications (from 1989 to 2022) in the financial field of both developed and emerging countries. The main purpose is to emphasize the minutiae of several types of research that elucidate the employment of AI and ML in finance. The findings of our study are summarized and developed into seven fields: (1) Portfolio Management and Robo-Advisory, (2) Risk Management and Financial Distress (3), Financial Fraud Detection and Anti-money laundering, (4) Sentiment Analysis and Investor Behaviour, (5) Algorithmic Stock Market Prediction and High-frequency Trading, (6) Data Protection and Cybersecurity, (7) Big Data Analytics, Blockchain, FinTech. Further, we demonstrate in each field, how research in AI and ML enhances the current financial sector, as well as their contribution in terms of possibilities and solutions for myriad financial institutions and organizations. We conclude with a global map review of 110 documents per the seven fields of AI and ML application.   Keywords: Artificial Intelligence, Machine Learning, Finance, Scoping review, Casablanca Exchange Market. JEL Classification: C80 Paper type: Theoretical ResearchIn the 2020s, Artificial Intelligence (AI) has been increasingly becoming a dominant technology, and thanks to new computer technologies, Machine Learning (ML) has also experienced remarkable growth in recent years; however, Artificial Intelligence (AI) needs notable data scientist and engineers’ innovation to evolve. Hence, in this paper, we aim to infer the intellectual development of AI and ML in finance research, adopting a scoping review combined with an embedded review to pursue and scrutinize the services of these concepts. For a technical literature review, we goose-step the five stages of the scoping review methodology along with Donthu et al.’s (2021) bibliometric review method. This article highlights the trends in AI and ML applications (from 1989 to 2022) in the financial field of both developed and emerging countries. The main purpose is to emphasize the minutiae of several types of research that elucidate the employment of AI and ML in finance. The findings of our study are summarized and developed into seven fields: (1) Portfolio Management and Robo-Advisory, (2) Risk Management and Financial Distress (3), Financial Fraud Detection and Anti-money laundering, (4) Sentiment Analysis and Investor Behaviour, (5) Algorithmic Stock Market Prediction and High-frequency Trading, (6) Data Protection and Cybersecurity, (7) Big Data Analytics, Blockchain, FinTech. Further, we demonstrate in each field, how research in AI and ML enhances the current financial sector, as well as their contribution in terms of possibilities and solutions for myriad financial institutions and organizations. We conclude with a global map review of 110 documents per the seven fields of AI and ML application.   Keywords: Artificial Intelligence, Machine Learning, Finance, Scoping review, Casablanca Exchange Market. JEL Classification: C80 Paper type: Theoretical Researc

Stacked LSTM-GRU Long-Term Forecasting Model for Indonesian Islamic Banks

The development of the Islamic banking industry in Indonesia has become a significant concern in recent years, with rapid growth in the number of banks operating based on Sharia principles. To face emerging challenges and opportunities, a deep understanding of the long-term financial behavior of Islamic banks is becoming increasingly important. This study aims to predict the share price of PT Bank Syariah Indonesia Tbk, over 28 days using the LSTM-GRU stack. The observation stage includes importing the dataset, data separation, model variations, the training process, output, and evaluation. Observations were conducted using 10 model variations from 4 stacks of LSTM and GRU. Each model performs the training process in four epochs (200, 500, 750, and 1000). The results of observations in this study show that long-term predictions (28 days ahead) using four stacks of LSTM-GRU and daily training accumulation techniques produce better accuracy than the general method (using multiple outputs). From the observations we have made for predictions for the next 28 days, the model with the LGLG stack arrangement (LSTM-GRU-LSTM-GRU) produces the best accuracy at epoch 750 with an MSE LSTM-GRU 63.43762863. This study will undoubtedly continue in order to achieve even better precision, either by utilizing a new design or by further improving the technology we are now employing

Prediction of Stocks and Stock Price using Artificial Intelligence : A Bibliometric Study using Scopus Database

Prediction of stocks and the prices of the stock is one of the most crucial points of discussion amongst the researchers and analysts in the financial domain to date. Every stakeholder and most importantly the investor desires to earn higher profit for his investment in the market and try to use several different strategies to invest their money. There are numerous methods to predict and analyse the movement of the stock prices. They are broadly divided into – statistical and artificial intelligence-based methods. Artificial intelligence is used to predict the futuristic prices of stocks and use wide range of algorithms like – SVMs, CNNs, LSTMs, RNNs , etc. This bibliometric study focusses on the study based primarily on the Scopus database. We have considered important keywords, authors, citations along with the correlations between the co-appearing authors, source titles and keywords with the use of network diagrams for visualisation. On the basis of this paper, we conclude that there is ample opportunity for research in the domain of financial market

An Improved Artificial Intelligence Based on Gray Wolf Optimization and Cultural Algorithm to Predict Demand for Dairy Products: A Case Study

This paper provides an integrated framework based on statistical tests, time series neural network and improved multi-layer perceptron neural network (MLP) with novel meta-heuristic algorithms in order to obtain best prediction of dairy product demand (DPD) in Iran. At first, a series of economic and social indicators that seemed to be effective in the demand for dairy products is identified. Then, the ineffective indices are eliminated by using Pearson correlation coefficient, and statistically significant variables are determined. Then, MLP is improved with the help of novel meta-heuristic algorithms such as gray wolf optimization and cultural algorithm. The designed hybrid method is used to predict the DPD in Iran by using data from 2013 to 2017. The results show that the MLP offers 71.9% of the coefficient of determination, which is better compared to the other two methods if no improvement is achieved

A Deep Learning Model for Predicting Stock Prices in Tanzania

This research article was published by Engineering, Technology & Applied Science Research in Volume: 13 | Issue: 2 | Pages: 10517-10522 | April 2023 |Stock price prediction models help traders to reduce investment risk and choose the most profitable stocks. Machine learning and deep learning techniques have been applied to develop various models. As there is a lack of literature on efforts to utilize such techniques to predict stock prices in Tanzania, this study attempted to fill this gap. This study selected active stocks from the Dar es Salaam Stock Exchange and developed LSTM and GRU deep learning models to predict the next-day closing prices. The results showed that LSTM had the highest prediction accuracy with an RMSE of 4.7524 and an MAE of 2.4377. This study also aimed to examine whether it is significant to account for the outstanding shares of each stock when developing a joint model for predicting the closing prices of multiple stocks. Experimental results with both models revealed that prediction accuracy improved significantly when the number of outstanding shares of each stock was taken into account. The LSTM model achieved an RMSE of 10.4734 when the outstanding shares were not taken into account and 4.7524 when they were taken into account, showing an improvement of 54.62%. However, GRU achieved an RMSE of 12.4583 when outstanding shares were not taken into account and 8.7162 when they were taken into account, showing an improvement of 30.04%. The best model was implemented in a web-based prototype to make it accessible to stockbrokers and investment advisors

Prediction of the Mechanical Behaviour of HDPE Pipes Using the Artificial Neural Network Technique

Actual statistics show that in recent years, more than 90% of the water distribution pipes installed in the world are made of plastic, exclusively polyethylene (PE). Due to the extensive use of these materials, it is necessary to have a good understanding of the mechanical properties of HDPE used for distribution system piping. For our study, we selected HDPE pipes as the material of choice. We then took a new approach to the analysis and prediction of mechanical properties, using new models based on Artificial Intelligence. In this paper, experimental tensile tests were conducted to obtain the mechanical properties of pipes. The first part of this work focuses on the mechanical tests, specifically tensile tests, while the second part centers on the numerical procedure for predicting the mechanical characteristics, a deep learning model was developed for prediction. The model was trained using a large dataset, including information on pipes. Specially designed deep learning architectures capture complex relationships and patterns in the data, enabling accurate predictions, Several ANN models were created to predict mechanical behaviour based on experimental data. We analyzed Bayesian regularization using MATLAB, an advantage of BR artificial neural networks is their ability to reveal potentially complex relationships. The results showed that the constructed prediction model is satisfactory since the M.S.E. value is nearly 0 (0.00023) and the  value is close to 1 (0.99934).  This study evaluates the advantages of our methodology by demonstrating the predictive power of an AI-based method and how well it predicts HDPE pipe behavior. The paper study will have significant effects on the water distribution and plastics industries

Emerging Technologies for the Energy Systems of the Future

Energy systems are transiting from conventional energy systems to modernized and smart energy systems. This Special Issue covers new advances in the emerging technologies for modern energy systems from both technical and management perspectives. In modern energy systems, an integrated and systematic view of different energy systems, from local energy systems and islands to national and multi-national energy hubs, is important. From the customer perspective, a modern energy system is required to have more intelligent appliances and smart customer services. In addition, customers require the provision of more useful information and control options. Another challenge for the energy systems of the future is the increased penetration of renewable energy sources. Hence, new operation and planning tools are required for hosting renewable energy sources as much as possible