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It is a well known fact that recovery rates tend to go down when the number of defaults goes up in economic downturns. We demonstrate how the loss given default model with the default and recovery dependent via the latent systematic risk…

Risk Management · Quantitative Finance 2014-11-03 Xiaolin Luo , Pavel V. Shevchenko

We present a very fast algorithm for general matrix factorization of a data matrix for use in the statistical analysis of high-dimensional data via latent factors. Such data are prevalent across many application areas and generate an…

This work considers estimation and forecasting in a multivariate, possibly high-dimensional count time series model constructed from a transformation of a latent Gaussian dynamic factor series. The estimation of the latent model parameters…

Methodology · Statistics 2025-04-07 Younghoon Kim , Marie-Christine Düker , Zachary F. Fisher , Vladas Pipiras

The graph Fourier transform (GFT) is in general dense and requires O(n^2) time to compute and O(n^2) memory space to store. In this paper, we pursue our previous work on the approximate fast graph Fourier transform (FGFT). The FGFT is…

Numerical Analysis · Computer Science 2017-11-07 Luc LeMagoarou , Nicolas Tremblay , Rémi Gribonval

We propose a new algorithm for efficiently solving the damped Fisher matrix in large-scale scenarios where the number of parameters significantly exceeds the number of available samples. This problem is fundamental for natural gradient…

Machine Learning · Computer Science 2023-10-27 Yixiao Chen , Hao Xie , Han Wang

In this paper, we propose a new regression-based algorithm to compute Graph Fourier Transform (GFT). Our algorithm allows different regularizations to be included when computing the GFT analysis components, so that the resulting components…

Signal Processing · Electrical Eng. & Systems 2018-11-22 Seyed Hamid Safavi , Manas Khatua , Ngai-Man Cheung , Farah Torkamani-Azar

In this paper we propose a cyclical coordinate descent (CCD) algorithm for solving high dimensional risk parity problems. We show that this algorithm converges and is very fast even with large covariance matrices (n > 500). Comparison with…

Portfolio Management · Quantitative Finance 2013-11-19 Théophile Griveau-Billion , Jean-Charles Richard , Thierry Roncalli

In this article we present an algorithm to efficiently evaluate the exchange matrix in periodic systems when Gaussian basis set with pseudopotentials are used. The usual algorithm for evaluating exchange matrix scales cubically with the…

Strongly Correlated Electrons · Physics 2022-11-11 Sandeep Sharma , Alec F. White , Gregory Beylkin

We present an algorithm which efficiently estimates the intrinsic long-term value of a portfolio of assets on a quantum computer. The method relies on quantum amplitude estimation to estimate the mean of a novel implementation of the…

Recent developments in deep learning techniques have motivated intensive research in machine learning-aided stock trading strategies. However, since the financial market has a highly non-stationary nature hindering the application of…

Portfolio Management · Quantitative Finance 2020-12-15 Kentaro Imajo , Kentaro Minami , Katsuya Ito , Kei Nakagawa

We consider a stochastic generalized Nash equilibrium problem (GNEP) with expected-value cost functions. Inspired by Yi and Pavel (Automatica, 2019), we propose a distributed GNE seeking algorithm by exploiting the forward-backward operator…

Optimization and Control · Mathematics 2020-02-17 Barbara Franci , Sergio Grammatico

We introduce a Fourier-based fast algorithm for Gaussian process regression in low dimensions. It approximates a translationally-invariant covariance kernel by complex exponentials on an equispaced Cartesian frequency grid of $M$ nodes.…

Computation · Statistics 2023-05-19 Philip Greengard , Manas Rachh , Alex Barnett

Most machine learning methods require careful selection of hyper-parameters in order to train a high performing model with good generalization abilities. Hence, several automatic selection algorithms have been introduced to overcome tedious…

Machine Learning · Computer Science 2020-01-17 Raju Ram , Sabine Müller , Franz-Josef Pfreundt , Nicolas R. Gauger , Janis Keuper

Solving large-scale robust portfolio optimization problems is challenging due to the high computational demands associated with an increasing number of assets, the amount of data considered, and market uncertainty. To address this issue, we…

Computational Finance · Quantitative Finance 2024-08-16 Chung-Han Hsieh , Jie-Ling Lu

This paper proposes an efficient general alternating-direction implicit (GADI) framework for solving large sparse linear systems. The convergence property of the GADI framework is discussed. Most of the existing ADI methods can be viewed as…

Numerical Analysis · Mathematics 2022-05-04 Kai Jiang , Xuehong Su , Juan Zhang

Most of previous works and applications of Bayesian factor model have assumed the normal likelihood regardless of its validity. We propose a Bayesian factor model for heavy-tailed high-dimensional data based on multivariate Student-$t$…

Methodology · Statistics 2020-12-10 Jaejoon Lee , Jaeyong Lee

Linear reversible circuits represent a subclass of reversible circuits with many applications in quantum computing. These circuits can be efficiently simulated by classical computers and their size is polynomially bounded by the number of…

Graphical models are a powerful tool to estimate a high-dimensional inverse covariance (precision) matrix, which has been applied for a portfolio allocation problem. The assumption made by these models is a sparsity of the precision matrix.…

Econometrics · Economics 2023-04-04 Tae-Hwy Lee , Ekaterina Seregina

In this paper, we study the problem of deriving fast and accurate classification algorithms with uncertainty quantification. Gaussian process classification provides a principled approach, but the corresponding computational burden is…

Machine Learning · Computer Science 2018-05-29 Dimitrios Milios , Raffaello Camoriano , Pietro Michiardi , Lorenzo Rosasco , Maurizio Filippone

The cumulative shrinkage process is an increasing shrinkage prior that can be employed within models in which additional terms are supposed to play a progressively negligible role. A natural application is to Gaussian factor models, where…

Computation · Statistics 2020-08-13 Sirio Legramanti