Soft computing techniques applied to finance

Abstract

Soft computing is progressively gaining presence in the financial world. The number of real and potential applications is very large and, accordingly, so is the presence of applied research papers in the literature. The aim of this paper is both to present relevant application areas, and to serve as an introduction to the subject. This paper provides arguments that justify the growing interest in these techniques among the financial community and introduces domains of application such as stock and currency market prediction, trading, portfolio management, credit scoring or financial distress prediction areas.

An investigation into the recurring patterns of forex time series data

“…Although technical analysis has traditionally been used by traders, researchers have begun adopting the use of historical data for various analysis using soft/hard computing methods introduced in Artificial Intelligence [5,6]. Forex historical data required obtained from sources such as OANDA.com, HistData.com, and TradeStation [7][8][9][10] have been integrated into the innumerable application of technical analysis and AI methods.…”

Role of soft computing techniques in predicting stock market direction

“…The research paper explains the application of soft computing in financial cases where we deal with problems whose nature is highly unstructured or which involve incomplete information or corrupted data, among others. This paper takes the following four cases [4] where the soft computing is playing major role:…”

“…All research study [4][5][6][7][8] described in section II are deals with complex problem where raw data have highly noise due to buying and selling security with different time and different volume. All research study discussed in this paper is used soft computing techniques to solve two different market, stock market and commodity market.…”

“…All research study discussed in this paper is used soft computing techniques to solve two different market, stock market and commodity market. These research study [4][5][6][7] take the problem example of stock market while research study [8] takes the problem example of commodities and oil. Research study [8] may not provide accuracy on the stock market without modifying its input parameter due to both the stock market and commodity input parameter are affected different way.…”

“…This paper is structured as follows: the second section deals with major work done on each of five research papers [4][5][6][7][8] . The third section draws commonalities and differences between these papers to establish the technical gap.…”