artificial neural network vs traditional algorithms

Discussion in 'App Development' started by aquz, Nov 1, 2012.

  1. Humpy

    Humpy

    I just dumped my NN for a home made algo that was performing better.
     
    #21     Nov 18, 2012
  2. +
     
    #22     Nov 18, 2012
  3. As Bowgett mentioned and (with my little experience) I also agree... I think neural nets are mostly useful for on-going parameter optimization vs using them to make trading decisions.

    What I do and suggest to others.... I would focus on building profitable strategies first then see where a NN could help with optimization if its needed. With as much computing power is available today, from Amazon EC2 and others, you should be able to complete optimization for hundreds of instruments by the end of the weekend for the coming trading week.
     
    #23     Jan 11, 2013
  4. Humpy

    Humpy

    optimisation looks like the Holy Grail but they never go on performing as well.

    Mathematicians can calculate the orbits of comets and whole galaxies but they can't forecast the markets yet.
    Indicators use past historical data and for that reason lag badly. Barely better than a coin toss.
    Even clever people get seduced by the huge amounts of money on offer and can waste decades and fortunes trying to find the correct answers.
     
    #24     Jan 11, 2013
  5. Here is where the entire logic of the experiment falls apart. Any result that passes your test will be nothing more than a curvefit..simple survivorship bias that is not logically rooted in any market principles

    What i've noticed about people who are interested in NN, and GP, and machine learning is that "playing around" with the TECHNOLOGY is more important to them than the actual act of TRADING and making money.

    You have a free machine that learns..it's called your brain
     
    #25     Jan 11, 2013
  6. Sanz

    Sanz

    My experience is
    1. NN's tend to immediately over-fit the data.
    2. It's hard to come up with a performance function to train the NNs.
    2. You may end up not trading an NN alone since you will not trust it.

    But they are great to play with!
     
    #26     Jan 14, 2013
  7. boskop

    boskop

    it's just a matter of sufficient input/output quantization ;)
     
    #27     Jan 15, 2013