NNs have many weaknesses for trading. GAs can work, but there are much simpler ways to make money in the markets... Intro the Genetic Algorithms: http://www.doc.ic.ac.uk/~nd/surprise_96/journal/vol4/tcw2/report.html Somemore background: http://www.amazon.com/gp/product/00..._1/103-6716207-6131052?_encoding=UTF8&s=books
I could not agree with you more. Neural network are just fancy non linear regression or pattern matching software. The key is that they can create models which are independent of assumption about data distributions. I guess "nitro" is showing his ignorance on the subject. If he thinks that neural networks in trading systems are used to replace trading experts then he has a lot to learn about trading system development.
Yes I do actually trade, but I have not traded a neural network based model in several years. In addition I have several institutional clients which trade systems I have developed. During the past few years I have not done much work with neural networks because I was working on TradersStudio, but I am currently starting my research back up since I now have the tools I need to do my research. I have been in this business for over 15 years and have developed many system which I have published in the over 140 articles I have written. Many of them which I developed over ten years ago have been profitable all this time. That says something about the quality of the research that I have done, that my free stuff has stood the test of time. It takes guts to publish systems in books and magazines where people can try them out 10 year later and see if they still work.
It was in Nov 1992, I also was on CNBC in 1994 discussing neural networks and intermarket analysis. I was on CNBC a few more times over the next few years with John Murphy.
Would you mind to share, whether your clients require any exclusivity on the systems? Are there usually any incentive components in the deals?
nitro--Of the folks I know who are serious quants, trade for a living and apply AI & NN work to trading, none of them publish, or post to retail-oriented websites. They dont want publicity, in any form. They prefer a bonus check.
Most people see a neural network as a miraculous solution. They think you only have to push a button and wait a few days until all the calculations are done and the correct answer will be given. That's completely wrong. A neural network is a tool. If you don't know how to use it it's useless. I bought a neural network. 450 pages of the manuals were filled with how you have to prepare the correct sets of data. The whole system stays or falls with the way how you feed the data. 90% of the people on this forum are probably not able to put the right set of data in the computer to have a chance of getting something useful out of it. Iâm part of these 90%.