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In recent years, challenging control problems became solvable with deep reinforcement learning (RL). To be able to use RL for large-scale real-world applications, a certain degree of reliability in their performance is necessary. Reported…

Machine Learning · Computer Science 2020-11-11 Nirnai Rao , Elie Aljalbout , Axel Sauer , Sami Haddadin

Reinforcement learning (RL), particularly its combination with deep neural networks referred to as deep RL (DRL), has shown tremendous promise across a wide range of applications, suggesting its potential for enabling the development of…

Robotics · Computer Science 2024-09-17 Chen Tang , Ben Abbatematteo , Jiaheng Hu , Rohan Chandra , Roberto Martín-Martín , Peter Stone

Deep Reinforcement Learning (Deep RL) has been explored for a number of applications in finance and stock trading. In this paper, we present a practical implementation of Deep RL for trading natural gas futures contracts. The Sharpe Ratio…

Trading and Market Microstructure · Quantitative Finance 2023-09-12 Yuanrong Wang , Yinsen Miao , Alexander CY Wong , Nikita P Granger , Christian Michler

In this paper, we introduce a novel reinforcement learning framework for optimal trade execution in a limit order book. We formulate the trade execution problem as a dynamic allocation task whose objective is the optimal placement of market…

Trading and Market Microstructure · Quantitative Finance 2026-01-28 Patrick Cheridito , Moritz Weiss

Hierarchical reinforcement learning (HRL) improves the efficiency of long-horizon reinforcement-learning tasks with sparse rewards by decomposing the task into a hierarchy of subgoals. The main challenge of HRL is efficient discovery of the…

Machine Learning · Computer Science 2025-07-08 Sadegh Khorasani , Saber Salehkaleybar , Negar Kiyavash , Matthias Grossglauser

In many reinforcement learning applications, the underlying environment reward and transition functions are explicitly known differentiable functions. This enables us to use recent research which applies machine learning tools to stochastic…

Portfolio Management · Quantitative Finance 2022-04-08 Thibault Jaisson

Deep Reinforcement Learning (DRL) algorithms can scale to previously intractable problems. The automation of profit generation in the stock market is possible using DRL, by combining the financial assets price "prediction" step and the…

Trading and Market Microstructure · Quantitative Finance 2022-09-20 Taylan Kabbani , Ekrem Duman

We employ deep reinforcement learning (RL) to train an agent to successfully translate a high-frequency trading signal into a trading strategy that places individual limit orders. Based on the ABIDES limit order book simulator, we build a…

Trading and Market Microstructure · Quantitative Finance 2023-09-27 Peer Nagy , Jan-Peter Calliess , Stefan Zohren

Reinforcement learning (RL) techniques have shown great success in many challenging quantitative trading tasks, such as portfolio management and algorithmic trading. Especially, intraday trading is one of the most profitable and risky tasks…

Trading and Market Microstructure · Quantitative Finance 2022-08-23 Shuo Sun , Wanqi Xue , Rundong Wang , Xu He , Junlei Zhu , Jian Li , Bo An

A wide variety of deep reinforcement learning (DRL) models have recently been proposed to learn profitable investment strategies. The rules learned by these models outperform the previous strategies specially in high frequency trading…

Statistical Finance · Quantitative Finance 2021-01-12 Mehran Taghian , Ahmad Asadi , Reza Safabakhsh

Reinforcement learning (RL) has shown significant promise for sequential portfolio optimization tasks, such as stock trading, where the objective is to maximize cumulative returns while minimizing risks using historical data. However,…

Machine Learning · Computer Science 2025-05-20 Haochen Yuan , Minting Pan , Yunbo Wang , Siyu Gao , Philip S. Yu , Xiaokang Yang

Deep reinforcement learning (DRL) is a well-suited approach to financial decision-making, where an agent makes decisions based on its trading strategy developed from market observations. Existing DRL intraday trading strategies mainly use…

Trading and Market Microstructure · Quantitative Finance 2024-06-13 Sven Goluža , Tomislav Kovačević , Tessa Bauman , Zvonko Kostanjčar

Over the past decades, researchers have been pushing the limits of Deep Reinforcement Learning (DRL). Although DRL has attracted substantial interest from practitioners, many are blocked by having to search through a plethora of available…

Mathematical Finance · Quantitative Finance 2023-10-05 Sophia Gu

Developing professional, structured reasoning on par with human financial analysts and traders remains a central challenge in AI for finance, where markets demand interpretability and trust. Traditional time-series models lack…

Trading and Market Microstructure · Quantitative Finance 2025-09-16 Yijia Xiao , Edward Sun , Tong Chen , Fang Wu , Di Luo , Wei Wang

We present a reinforcement-learning (RL) framework for dynamic hedging of equity index option exposures under realistic transaction costs and position limits. We hedge a normalized option-implied equity exposure (one unit of underlying…

Portfolio Management · Quantitative Finance 2025-12-16 Travon Lucius , Christian Koch , Jacob Starling , Julia Zhu , Miguel Urena , Carrie Hu

Safe Reinforcement Learning (RL) plays an important role in applying RL algorithms to safety-critical real-world applications, addressing the trade-off between maximizing rewards and adhering to safety constraints. This work introduces a…

Robotics · Computer Science 2024-07-16 Fan Yang , Wenxuan Zhou , Zuxin Liu , Ding Zhao , David Held

This scientific research paper presents an innovative approach based on deep reinforcement learning (DRL) to solve the algorithmic trading problem of determining the optimal trading position at any point in time during a trading activity in…

Trading and Market Microstructure · Quantitative Finance 2022-06-06 Thibaut Théate , Damien Ernst

In financial applications, reinforcement learning (RL) agents are commonly trained on historical data, where their actions do not influence prices. However, during deployment, these agents trade in live markets where their own transactions…

Machine Learning · Computer Science 2026-01-27 Shaocong Ma , Heng Huang

Although safety stock optimisation has been studied for more than 60 years, most companies still use simplistic means to calculate necessary safety stock levels, partly due to the mismatch between existing analytical methods' emphases on…

Multiagent Systems · Computer Science 2021-07-05 Edward Elson Kosasih , Alexandra Brintrup

Hierarchical reinforcement learning (HRL) has seen widespread interest as an approach to tractable learning of complex modular behaviors. However, existing work either assume access to expert-constructed hierarchies, or use…

Machine Learning · Computer Science 2021-10-19 Kurtland Chua , Qi Lei , Jason D. Lee