Stock Market Prediction via Deep Learning Techniques: A Survey

The stock market prediction has been a traditional yet complex problem researched within diverse research areas and application domains due to its non-linear, highly volatile and complex nature. Existing surveys on stock market prediction often focus on traditional machine learning methods instead of deep learning methods. Deep learning has dominated many domains, gained much success and popularity in recent years in stock market prediction. This motivates us to provide a structured and comprehensive overview of the research on stock market prediction focusing on deep learning techniques. We present four elaborated subtasks of stock market prediction and propose a novel taxonomy to summarize the state-of-the-art models based on deep neural networks from 2011 to 2022. In addition, we also provide detailed statistics on the datasets and evaluation metrics commonly used in the stock market. Finally, we highlight some open issues and point out several future directions by sharing some new perspectives on stock market prediction

Forex Trading Signal Extraction with Deep Learning Models

The rise of AI technology has popularized deep learning models for financial trading prediction, promising substantial profits with minimal risk. Institutions like Westpac, Commonwealth Bank of Australia, Macquarie Bank, and Bloomberg invest heavily in this transformative technology. Researchers have also explored AI's potential in the exchange rate market. This thesis focuses on developing advanced deep learning models for accurate forex market prediction and AI-powered trading strategies. Three deep learning models are introduced: an event-driven LSTM model, an Attention-based VGG16 model named MHATTN-VGG16, and a pre-trained model called TradingBERT. These models aim to enhance signal extraction and price forecasting in forex trading, offering valuable insights for decision-making. The first model, an LSTM, predicts retracement points crucial for identifying trend reversals. It outperforms baseline models like GRU and RNN, thanks to noise reduction in the training data. Experiments determine the optimal number of timesteps for trend identification, showing promise for building a robotic trading platform. The second model, MHATTN-VGG16, predicts maximum and minimum price movements in forex chart images. It combines VGG16 with multi-head attention and positional encoding to effectively classify financial chart images. The third model utilizes a pre-trained BERT architecture to transform trading price data into normalized embeddings, enabling meaningful signal extraction from financial data. This study pioneers the use of pre-trained models in financial trading and introduces a method for converting continuous price data into categorized elements, leveraging the success of BERT. This thesis contributes innovative approaches to deep learning in algorithmic trading, offering traders and investors precision and confidence in navigating financial markets

Multi-timeframe algorithmic trading bots using thick data heuristics with deep reinforcement learning

This thesis presents an augmented Artificial Intelligence (AI) algorithmic trading approach that combines Thick Data Heuristics (TDH), with Deep Reinforcement Learning (DRL), to successfully learn trading execution timing policies. In this thesis, combining the augmented AI human trader’s intuition and heuristics with DRL techniques to provide more focused drivers for trading order execution timing is explored. In this financial technology (Fintech) research, the goal is to solve the sequential decision-making problem of AI for profitable day and swing trading order timing executions. Enabling trading bots with cognitive intelligence and common-sense heuristics will offer traders including automatic traders an insight to understand the day-to-day swing trading timeframes indicators and arrive at mature trading decision-making. This thesis examines the performance of bots with Nasdaq and NYSE stocks that have a strong catalyst (info. which increases directional momentum) to find that they outperform benchmark algorithmic trading approaches. The thesis illustrates to the reader how to combine TDH and Deep Q-networks (DQN) into a TDH-DQN augmented AI trading bot. The bot learns through test data to predict the optimal timing of order executions autonomously on idealized trading time series data. The results show the TDH-DQN bot outperformed the buy and hold strategy plus two out of the three benchmark algorithmic trading strategies

A novel financial trading system based on reinforcement learning and technical analysis applied on the Tehran securities exchange market

Stock trading is a significant decision-making problem in asset management. This study introduces a financial trading system (FTS) that leverages artificial intelligence (AI) techniques to automate buy and sell orders specifically in Iran's stock market. Due to limited availability of labeled data in financial markets, the FTS utilizes reinforcement learning (RL), a subset of AI, for training. The model incorporates technical analysis and a constrained policy to enhance decision-making capabilities. The proposed algorithm is applied to the Tehran Securities Exchange, evaluating its efficiency across 45 periods using three different stock market indices. Performance comparisons are made against common strategies such as buy and hold, randomly selected actions, and maintaining the initial stock portfolio, with and without transaction costs. The results indicate that the FTS outperforms these methods, exhibiting excellent performance metrics including Sharp ratio, PP, PF, and MDD. Consequently, the findings suggest that the FTS serves as a valuable asset management tool in the Iranian financial market

Data science in economics: Comprehensive review of advanced machine learning and deep learning methods

© 2020 by the authors. Licensee MDPI, Basel, Switzerland. This paper provides a comprehensive state-of-the-art investigation of the recent advances in data science in emerging economic applications. The analysis is performed on the novel data science methods in four individual classes of deep learning models, hybrid deep learning models, hybrid machine learning, and ensemble models. Application domains include a broad and diverse range of economics research from the stock market, marketing, and e-commerce to corporate banking and cryptocurrency. Prisma method, a systematic literature review methodology, is used to ensure the quality of the survey. The findings reveal that the trends follow the advancement of hybrid models, which outperform other learning algorithms. It is further expected that the trends will converge toward the evolution of sophisticated hybrid deep learning models

Dynamic portfolio rebalancing through reinforcement learning

Portfolio managements in financial markets involve risk management strategies and opportunistic responses to individual trading behaviours. Optimal portfolios constructed aim to have a minimal risk with highest accompanying investment returns, regardless of market conditions. This paper focuses on providing an alternative view in maximising portfolio returns using Reinforcement Learning (RL) by considering dynamic risks appropriate to market conditions through dynamic portfolio rebalancing. The proposed algorithm is able to improve portfolio management by introducing the dynamic rebalancing of portfolios with vigorous risk through an RL agent. This is done while accounting for market conditions, asset diversifications, risk and returns in the global financial market. Studies have been performed in this paper to explore four types of methods with variations in fully portfolio rebalancing and gradual portfolio rebalancing, which combine with and without the use of the Long Short-Term Memory (LSTM) model to predict stock prices for adjusting the technical indicator centring. Performances of the four methods have been evaluated and compared using three constructed financial portfolios, including one portfolio with global market index assets with different risk levels, and two portfolios with uncorrelated stock assets from different sectors and risk levels. Observed from the experiment results, the proposed RL agent for gradual portfolio rebalancing with the LSTM model on price prediction outperforms the other three methods, as well as returns of individual assets in these three portfolios. The improvements of the returns using the RL agent for gradual rebalancing with prediction model are achieved at about 27.9–93.4% over those of the full rebalancing without prediction model. It has demonstrated the ability to dynamically adjust portfolio compositions according to the market trends, risks and returns of the global indices and stock assets

Pathway to Future Symbiotic Creativity

This report presents a comprehensive view of our vision on the development path of the human-machine symbiotic art creation. We propose a classification of the creative system with a hierarchy of 5 classes, showing the pathway of creativity evolving from a mimic-human artist (Turing Artists) to a Machine artist in its own right. We begin with an overview of the limitations of the Turing Artists then focus on the top two-level systems, Machine Artists, emphasizing machine-human communication in art creation. In art creation, it is necessary for machines to understand humans' mental states, including desires, appreciation, and emotions, humans also need to understand machines' creative capabilities and limitations. The rapid development of immersive environment and further evolution into the new concept of metaverse enable symbiotic art creation through unprecedented flexibility of bi-directional communication between artists and art manifestation environments. By examining the latest sensor and XR technologies, we illustrate the novel way for art data collection to constitute the base of a new form of human-machine bidirectional communication and understanding in art creation. Based on such communication and understanding mechanisms, we propose a novel framework for building future Machine artists, which comes with the philosophy that a human-compatible AI system should be based on the "human-in-the-loop" principle rather than the traditional "end-to-end" dogma. By proposing a new form of inverse reinforcement learning model, we outline the platform design of machine artists, demonstrate its functions and showcase some examples of technologies we have developed. We also provide a systematic exposition of the ecosystem for AI-based symbiotic art form and community with an economic model built on NFT technology. Ethical issues for the development of machine artists are also discussed