Applicability of data mining, machine learning, ai for daily prediction for intraday trading
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Applicability of Data Mining, Machine Learning, AI for Daily Prediction for Intraday Trading
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Applicability of data mining, machine learning, ai for daily prediction for intraday trading
- 1. Applicability of Data Mining, Machine Learning, AI for Daily Prediction for Intraday Trading skmota@gmail.com
- 2. Introduction High Level Process Flow Daily Predictions Suggested Automated Trading Approach Important Notes Appendix Agenda
- 3. Introduction Name – Sanjay Kumar Kantilal Mota Email – skmota@gmail.com Qualification – Bachelor of commerce, MBA (Finance), PG Diploma in Computers Certifications – PRINCE2 Practitioner, ITIL Foundation, Microsoft Certified Professional, Siebel Certified Consultant Work Experience – 26 years of IT experience working with Mastek, Deloitte, GENPACT, Wipro, Satyam, Accenture Geographic Experience – India, UK, USA, Japan Industry Experience – 6 years of Capital Market related projects
- 4. Artificial Intelligence SourceData • Historical Price Data • EOD • Intraday DataMining • Encoding • Decoding MachineLearning Algorithms • Training • Testing • Classification • Regression • Prediction Trading • Automated or Manual • Intra-day • Positional High Level Process Flow
- 5. Daily Predictions Based on historical End of Day price data using Data Mining, Machine Learning and AI 14 years of Training Data and 6 years of Test Data used Predicts if next day closing will be higher or lower than the next day opening levels Accuracy of 59% for Nifty, 9% more than by random guessing Profit from 59% Accurate Prediction 39862.15 points (871 days) Loss from 41% In-Accurate prediction 23963.5 points (604 days) Net profit 15898.65 points (Total 1475 days) For large volume Accuracy can be improved to 63% i.e. 13% more than by random guessing Can be used for Manual or Automated Intraday Trading Prediction available after closing of the current day market and before opening of the next day market
- 6. For Prediction of Closing > Opening Buy at and below opening Level Can also be used to trade in Binary Options Spread out the trade by creating additional buy trade when price falls by certain units e.g. every 0.05 points For Prediction of Closing < Opening Sell at and above opening level Can also be used in Binary Options Spread out the trade by creating additional sell trade when price rises by certain units e.g. every 0.05 points Suggested Automated Trading Approach Close all open positions before close of Trading Incremental spread of Trades by certain units will ensure higher profitability on profitable days (59%) and lesser loss on loss making days (41%) Intraday trading will provide for higher leverage and no overnight carry over
- 7. - Target Customers Plan to work with very few Large Trading Companies • Instruments with Large Market Capitalization and Liquidity • Different World Markets (FTSE, DJIA, S&P500, NIFTY …) • Large Trading Position Profitability • Plan to charge % of profit share
- 8. The Service is offered as it is on profit sharing basis without taking any responsivity for any trading risk and trading loss. Data for the instruments to be traded has to be provided by Customer The process used for predictive analytics using Data Mining, Machine Learning and AI are my IP rights and should be respected accordingly I am free to deal with other companies to use predictive analytics using Data Mining, Machine Learning and AI for other instruments in same or other markets Accuracy varies for each instrument and needs to checked based on historical price data Future prediction might or might not follow the past performance Important Notes
- 9. Cracking Wall Street Can technology build a better Buffett? List of Funds or Trading Firms Using Artificial Intelligence How Computers Trawl a Sea of Data for Stock Picks - WSJ Battle of the Quants Quants turn to AI for market insights Investor rush to artificial intelligence is real deal - FT.com AI That Picks Stocks Better Than the Pros | MIT Technology Israel's Financial Algorithms Gets $4B Buy Bid, Calcalist Says The Rise of the Tech Model May Soon Make You Obsolete BlackRock and Google in talks over joint venture - FT.com Big banks invest $13.5M in machine learning startup .. Goldman Sachs Leads $15 Million Investment in Kensho .. Artificial intelligence is the next big thing for hedge funds Introducing Binatix, a Deep- Learning Trading Firm That's ... Algorithmic Trading: Swing Trading Based on Machine .. Forex Scandal Drives Shift to Algo Trading - Wall Street ... Interesting Readings
- 10. Please contact on skmota@gmail.com for your interest in this strategy Thank You