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We perform a stability analysis for the utility maximization problem in a general semimartingale model where both liquid and illiquid assets (random endowments) are present. Small misspecifications of preferences (as modeled via expected…

Portfolio Management · Quantitative Finance 2010-03-17 Constantinos Kardaras , Gordan Zitkovic

Multistage ranking models, including the popular Plackett-Luce distribution (PL), rely on the assumption that the ranking process is performed sequentially, by assigning the positions from the top to the bottom one (forward order). A recent…

Methodology · Statistics 2020-03-17 Cristina Mollica , Luca Tardella

Real-world engineering systems are typically compared and contrasted using multiple metrics. For practical machine learning systems, performance tuning is often more nuanced than minimizing a single expected loss objective, and it may be…

Optimization and Control · Mathematics 2016-12-19 Ian Dewancker , Michael McCourt , Samuel Ainsworth

We study the problem of maximising terminal utility for an agent facing model uncertainty, in a frictionless discrete-time market with one safe asset and finitely many risky assets. We show that an optimal investment strategy exists if the…

Mathematical Finance · Quantitative Finance 2020-07-10 Miklós Rásonyi , Andrea Meireles-Rodrigues

As a compact representation of joint probability distributions over a dependence graph of random variables, and a tool for modelling and reasoning in the presence of uncertainty, Bayesian networks are of great importance for artificial…

Quantum Physics · Physics 2020-10-06 Michael de Oliveira , Luis Soares Barbosa

As large language models (LLMs) become integral to intelligent user interfaces (IUIs), their role as decision-making agents raises critical concerns about alignment. Although extensive research has addressed issues such as factuality, bias,…

Artificial Intelligence · Computer Science 2025-04-23 Anna Karnysheva , Christian Drescher , Dietrich Klakow

We study a general robust utility maximization problem in a discrete-time frictionless market. The investor is assumed to have a possibly infinite, random, nonconcave, and nondecreasing utility function defined on the whole real line. She…

Mathematical Finance · Quantitative Finance 2025-10-14 Laurence Carassus , Massinissa Ferhoune

A recent line of work, starting with Beigman and Vohra (2006) and Zadimoghaddam and Roth (2012), has addressed the problem of {\em learning} a utility function from revealed preference data. The goal here is to make use of past data…

Computer Science and Game Theory · Computer Science 2014-07-31 Maria-Florina Balcan , Amit Daniely , Ruta Mehta , Ruth Urner , Vijay V. Vazirani

We consider an extension of the contextual multi-armed bandit problem, in which, instead of selecting a single alternative (arm), a learner is supposed to make a preselection in the form of a subset of alternatives. More specifically, in…

Machine Learning · Computer Science 2020-02-12 Adil El Mesaoudi-Paul , Viktor Bengs , Eyke Hüllermeier

The topic of deep learning has seen a surge of interest in recent years both within and outside of the field of Statistics. Deep models leverage both nonlinearity and interaction effects to provide superior predictions in many cases when…

Methodology · Statistics 2020-09-18 Paul A. Parker , Scott H. Holan

The sum-utility maximization problem is known to be important in the energy systems literature. The conventional assumption to address this problem is that the utility is concave. But for some key applications, such an assumption is not…

Computer Science and Game Theory · Computer Science 2021-12-07 Chao Zhang , Samson Lasaulce , Li Wang , Lucas Saludjian , H. Vincent Poor

This study presents a semi-nonparametric Latent Class Choice Model (LCCM) with a flexible class membership component. The proposed model formulates the latent classes using mixture models as an alternative approach to the traditional random…

One of the most celebrated results in mechanism design is Myerson's characterization of the revenue optimal auction for selling a single item. However, this result relies heavily on the assumption that buyers are indifferent to risk. In…

Computer Science and Game Theory · Computer Science 2018-10-08 Evdokia Nikolova , Emmanouil Pountourakis , Ger Yang

Log-linear models are a well-established method for describing statistical dependencies among a set of n random variables. The observed frequencies of the n-tuples are explained by a joint probability such that its logarithm is a sum of…

Statistics Theory · Mathematics 2007-06-13 Daniel Herrmann , Dominik Janzing

We examine the problem of optimal portfolio allocation within the framework of utility theory. We apply exponential utility to derive the optimal diversification strategy and logarithmic utility to determine the optimal leverage. We enhance…

Portfolio Management · Quantitative Finance 2025-10-01 Vladimir Markov

After experimenting with a number of non-probabilistic methods for dealing with uncertainty many researchers reaffirm a preference for probability methods [1] [2], although this remains controversial. The importance of being able to form…

Artificial Intelligence · Computer Science 2013-04-11 Thomas Slack

Many models of interest in the natural and social sciences have no closed-form likelihood function, which means that they cannot be treated using the usual techniques of statistical inference. In the case where such models can be…

Computation · Statistics 2012-07-19 Simon Barthelmé , Nicolas Chopin

Machine learning (ML) has emerged as a powerful tool for tackling complex regression and classification tasks, yet its success often hinges on the quality of training data. This study introduces an ML paradigm inspired by domain knowledge…

Machine Learning · Computer Science 2025-01-10 Mohsen Rashki

Many of the existing approaches to assess and predict the performance of players, teams or products in competitive contests rely on the assumption that comparisons occur between pairs of such entities. There are, however, several real…

Physics and Society · Physics 2025-08-13 Jack Yeung , Daniel Kaiser , Filippo Radicchi

State-of-the-art multi-objective optimization often assumes a known utility function, learns it interactively, or computes the full Pareto front-each requiring costly expert input.~Real-world problems, however, involve implicit preferences…

Machine Learning · Computer Science 2025-10-01 Farha A. Khan , Tanmay Chakraborty , Jörg P. Dietrich , Christian Wirth