Saturday, August 18, 2012

Neural Networks in Finance and Investing

Neural networks are revolutionizing virtually every aspect of financial and investment decision making. Financial firms worldwide are employing neural networks to tackle difficult tasks involving intuitive judgement or requiring the detection of data patterns which elude conventional analytic techniques. Many observers believe neural networks will eventually outperform even the best traders and investors.

Neural networks are already being used to trade the securities markets, to forecast the economy and to analyze credit risk. Indeed, apart from the U.S. Department of Defense, the financial services industry has invested more money in neural network research than any other industry or government body. Unlike other types of artificial intelligence, neural networks mimic to some extent the processing characteristics of the human brain.

As a result, neural networks can draw conclusions from incomplete data, recognize patterns as they unfold in real time and forecast the future.

Great Book by the Authors : Efraim Turban and Robert R. Trippi.

See also this site that does the prediction work very easily :