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Dynamic portfolio optimization is the process of sequentially allocating wealth to a collection of assets in some consecutive trading periods, based on investors' return-risk profile. Automating this process with machine learning remains a…

Machine Learning · Computer Science 2019-01-28 Pengqian Yu , Joon Sern Lee , Ilya Kulyatin , Zekun Shi , Sakyasingha Dasgupta

Unfair stock trading strategies have been shown to be one of the most negative perceptions that customers can have concerning trading and may result in long-term losses for a company. Investment banks usually place trading orders for…

Trading and Market Microstructure · Quantitative Finance 2020-01-06 Wenhang Bao

We explore deep Reinforcement Learning(RL) algorithms for scalping trading and knew that there is no appropriate trading gym and agent examples. Thus we propose gym and agent like Open AI gym in finance. Not only that, we introduce new RL…

Artificial Intelligence · Computer Science 2019-04-02 Uk Jo , Taehyun Jo , Wanjun Kim , Iljoo Yoon , Dongseok Lee , Seungho Lee

Stock trading strategy plays a crucial role in investment companies. However, it is challenging to obtain optimal strategy in the complex and dynamic stock market. We explore the potential of deep reinforcement learning to optimize stock…

Machine Learning · Computer Science 2022-08-02 Xiao-Yang Liu , Zhuoran Xiong , Shan Zhong , Hongyang Yang , Anwar Walid

Solving portfolio management problems using deep reinforcement learning has been getting much attention in finance for a few years. We have proposed a new method using experts signals and historical price data to feed into our reinforcement…

Computational Finance · Quantitative Finance 2023-01-02 MohammadAmin Fazli , Mahdi Lashkari , Hamed Taherkhani , Jafar Habibi

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

This study proposed an exhaustive stable/reproducible rule-mining algorithm combined to a classifier to generate both accurate and interpretable models. Our method first extracts rules (i.e., a conjunction of conditions about the values of…

Machine Learning · Computer Science 2017-07-03 Margaux Luck , Nicolas Pallet , Cecilia Damon

Inverse reinforcement learning (IRL) is an imitation learning approach to learning reward functions from expert demonstrations. Its use avoids the difficult and tedious procedure of manual reward specification while retaining the…

Machine Learning · Computer Science 2024-03-25 Daulet Baimukashev , Gokhan Alcan , Ville Kyrki

Many imitation learning (IL) algorithms use inverse reinforcement learning (IRL) to infer a reward function that aligns with the demonstration. However, the inferred reward functions often fail to capture the underlying task objectives. In…

Machine Learning · Computer Science 2024-11-01 Weichao Zhou , Wenchao Li

Goal-based investing is an approach to wealth management that prioritizes achieving specific financial goals. It is naturally formulated as a sequential decision-making problem as it requires choosing the appropriate investment until a goal…

Portfolio Management · Quantitative Finance 2023-07-26 Tessa Bauman , Bruno Gašperov , Stjepan Begušić , Zvonko Kostanjčar

First-order methods for quadratic optimization such as OSQP are widely used for large-scale machine learning and embedded optimal control, where many related problems must be rapidly solved. These methods face two persistent challenges:…

Reinforcement learning (RL) algorithms update an agent's parameters according to one of several possible rules, discovered manually through years of research. Automating the discovery of update rules from data could lead to more efficient…

Machine Learning · Computer Science 2021-01-06 Junhyuk Oh , Matteo Hessel , Wojciech M. Czarnecki , Zhongwen Xu , Hado van Hasselt , Satinder Singh , David Silver

Instead of conducting manual factor construction based on traditional and behavioural finance analysis, academic researchers and quantitative investment managers have leveraged Genetic Programming (GP) as an automatic feature construction…

Statistical Finance · Quantitative Finance 2020-10-14 Jie Fang , Jianwu Lin , Shutao Xia , Yong Jiang , Zhikang Xia , Xiang Liu

Reinforcement learning (RL) algorithms have demonstrated promising results on complex tasks, yet often require impractical numbers of samples since they learn from scratch. Meta-RL aims to address this challenge by leveraging experience…

Machine Learning · Computer Science 2020-10-28 Russell Mendonca , Abhishek Gupta , Rosen Kralev , Pieter Abbeel , Sergey Levine , Chelsea Finn

We present a systematic trading framework that forecasts short-horizon market risk, identifies its underlying drivers, and generates alpha using a hybrid machine learning ensemble built to trade on the resulting signal. The framework…

Computational Finance · Quantitative Finance 2025-10-28 Aryan Ranjan

The risk premia of traded factors are the sum of factor means and a parameter vector we denote by {\phi} which is identified from the cross section regression of alpha of individual securities on the vector of factor loadings. If phi is…

Econometrics · Economics 2024-10-23 M. Hashem Pesaran , Ron P. Smith

This paper explores the application of a reinforcement learning (RL) framework using the Q-Learning algorithm to enhance dynamic pricing strategies in the retail sector. Unlike traditional pricing methods, which often rely on static demand…

Machine Learning · Computer Science 2024-11-28 Mohit Apte , Ketan Kale , Pranav Datar , Pratiksha Deshmukh

Reinforcement learning (RL) is gaining attention by more and more researchers in quantitative finance as the agent-environment interaction framework is aligned with decision making process in many business problems. Most of the current…

Mathematical Finance · Quantitative Finance 2022-05-31 Huifang Huang , Ting Gao , Yi Gui , Jin Guo , Peng Zhang

Reinforcement learning (RL) involves sequential decision making in uncertain environments. The aim of the decision-making agent is to maximize the benefit of acting in its environment over an extended period of time. Finding an optimal…

Artificial Intelligence · Computer Science 2007-05-23 Istvan Szita , Balint Takacs , Andras Lorincz

AI methods are used in societally important settings, ranging from credit to employment to housing, and it is crucial to provide fairness in regard to algorithmic decision making. Moreover, many settings are dynamic, with populations…

Machine Learning · Computer Science 2022-11-09 Zhun Deng , He Sun , Zhiwei Steven Wu , Linjun Zhang , David C. Parkes