Data Mining Practical Machine Learning Tools and Techniques

Swarm intelligence (SI) is briefly defined as the collective behaviour of decentralized and self-organized swarms. The well known examples for these swarms are bird flocks, fish schools and the colony of social insects such as termites, ants and bees. In 1990s, especially two approaches based on ant colony and on fish schooling/bird flocking introduced have highly attracted the interest of researchers. Although the self-organization features are required by SI are strongly and clearly seen in honey bee colonies, unfortunately the researchers have recently started to be interested in the behaviour of these swarm systems to describe new intelligent approaches, especially from the beginning of 2000s. During a decade, several algorithms have been developed depending on different intelligent behaviours of honey bee swarms. Among those, artificial bee colony (ABC) is the one which has been most widely studied on and applied to solve the real world problems, so far. Day by day the number of researchers being interested in ABC algorithm increases rapidly. This work presents a comprehensive survey of the advances with ABC and its applications. It is hoped that this survey would be very beneficial for the researchers studying on SI, particularly ABC algorithm.

A comprehensive survey: artificial bee colony (ABC) algorithm and applications

Neural networks

Nowadays, many current real financial applications have nonlinear and uncertain behaviors which change across the time. Therefore, the need to solve highly nonlinear, time variant problems has been growing rapidly. These problems along with other problems of traditional models caused growing interest in artificial intelligent techniques. In this paper, comparative research review of three famous artificial intelligence techniques, i.e., artificial neural networks, expert systems and hybrid intelligence systems, in financial market has been done. A financial market also has been categorized on three domains: credit evaluation, portfolio management and financial prediction and planning. For each technique, most famous and especially recent researches have been discussed in comparative aspect. Results show that accuracy of these artificial intelligent methods is superior to that of traditional statistical methods in dealing with financial problems, especially regarding nonlinear patterns. However, this outperformance is not absolute.

A comparative survey of artificial intelligence applications in finance: artificial neural networks, expert system and hybrid intelligent systems

We propose a survey of soft computing techniques applied to financial market.We surveyed several primary studies proposed in the literature.A framework for building an intelligent trading system was proposed.Future directions of this research field are discussed. Financial markets play an important role on the economical and social organization of modern society. In these kinds of markets, information is an invaluable asset. However, with the modernization of the financial transactions and the information systems, the large amount of information available for a trader can make prohibitive the analysis of a financial asset. In the last decades, many researchers have attempted to develop computational intelligent methods and algorithms to support the decision-making in different financial market segments. In the literature, there is a huge number of scientific papers that investigate the use of computational intelligence techniques to solve financial market problems. However, only few studies have focused on review the literature of this topic. Most of the existing review articles have a limited scope, either by focusing on a specific financial market application or by focusing on a family of machine learning algorithms. This paper presents a review of the application of several computational intelligent methods in several financial applications. This paper gives an overview of the most important primary studies published from 2009 to 2015, which cover techniques for preprocessing and clustering of financial data, for forecasting future market movements, for mining financial text information, among others. The main contributions of this paper are: (i) a comprehensive review of the literature of this field, (ii) the definition of a systematic procedure for guiding the task of building an intelligent trading system and (iii) a discussion about the main challenges and open problems in this scientific field.

Computational Intelligence and Financial Markets

The Effect of Data Pre-processing on Optimized Training of Artificial Neural Networks

Back-propagation Neural Network (BPNN) algorithm is one of the most widely used and a popular technique to optimize the feed forward neural network training. Traditional BP algorithm has some drawbacks, such as getting stuck easily in local minima and slow speed of convergence. Nature inspired meta-heuristic algorithms provide derivative-free solution to optimize complex problems. This paper proposed a new meta-heuristic search algorithm, called cuckoo search (CS), based on cuckoo bird's behavior to train BP in achieving fast convergence rate and to avoid local minima problem. The performance of the proposed Cuckoo Search Back-Propagation (CSBP) is compared with artificial bee colony using BP algorithm, and other hybrid variants. Specifically OR and XOR datasets are used. The simulation results show that the computational efficiency of BP training process is highly enhanced when coupled with the proposed hybrid method.

A new back-propagation neural network optimized with cuckoo search algorithm

A New Levenberg Marquardt Based Back Propagation Algorithm Trained with Cuckoo Search

Non-stationary and stationary prediction of financial time series using dynamic ridge polynomial neural network

The back propagation algorithm is one the most popular algorithms to train feed forward neural networks. However, the convergence of this algorithm is slow, it is mainly because of gradient descent algorithm. Previous research demonstrated that in ‘feed forward’ algorithm, the slope of the activation function is directly influenced by a parameter referred to as ‘gain’. This research proposed an algorithm for improving the performance of the back propagation algorithm by introducing the adaptive gain of the activation function. The gain values change adaptively for each node. The influence of the adaptive gain on the learning ability of a neural network is analysed. Multi layer feed forward neural networks have been assessed. Physical interpretation of the relationship between the gain value and the learning rate and weight values is given. The efficiency of the proposed algorithm is compared with conventional Gradient Descent Method and verified by means of simulation on four classification problems. In learning the patterns, the simulations result demonstrate that the proposed method converged faster on Wisconsin breast cancer with an improvement ratio of nearly 2.8, 1.76 on diabetes problem, 65% better on thyroid data sets and 97% faster on IRIS classification problem. The results clearly show that the proposed algorithm significantly improves the learning speed of the conventional back-propagation algorithm.

Nazri Mohd Nawi

Papers

The Effect of Data Pre-processing on Optimized Training of Artificial Neural Networks

A new back-propagation neural network optimized with cuckoo search algorithm

A New Levenberg Marquardt Based Back Propagation Algorithm Trained with Cuckoo Search

Non-stationary and stationary prediction of financial time series using dynamic ridge polynomial neural network

An Improved Back Propagation Neural Network Algorithm on Classification Problems