This presentation was made for a seminar to explain how AI is revolutionizing the Stock Market dynamics. Different types of AI based trading, Financial Analysis and ARTFICIAL NEURAL NETWORK is also explained in this presentation. A live video explaining the live stock price prediction using an ANN Software is done. Pros and Cons of AI based trading and human trading is also explained in the presentation. Overall this presentation is very informative and can be a new learning for the audience.

3. HISTORY OF AI

4. HISTORY OF AI

6. HAT

7. HAT
What is AI ?
What is stock market ?
What is efficient market ?

8. OW

9. OW
Decoding the mechanic of
AI powered stock market
trading
Methodology of Financial
analysis

10. YPES

11. YPES Breaking Down AI-Driven
Stock Trading

12. HY

13. HY
The Game Changer :
Exploring The Importance
of AI Based Trading
Comparison Between AI
and Human Stock Trading

15. WHAT IS
ARTIFICIAL
INTELLIGENCE
Artificial intelligence is the
simulation of human
intelligence processes by
machines, especially
computer systems using
algorithms.

16. WHAT IS STOCK MARKET
The Stock Market is where investors buy and sell
securities of companies. It’s a set of exchanges where
companies get their shares and other securities listed
for trading. It also includes over-the-counter (OTC)
marketplaces where investors trade securities directly
with each other rather than unlike in Exchange Traded
Contracts (ETC).

17. WHAT IS MARKET EFFICIENCY ?
The level in which market prices represent all
the information. If markets are efficient, all
information is already priced in, and there is
no way to "beat" the market because there
are no inexpensive or expensive assets
accessible.

18. HOW AI-BASED
STOCK TRADING
SOFTWARE WORKS

19. HOW AI-BASED
STOCK TRADING SOFTWARE WORKS
DATA
PREPROCESSING
MODEL
EVALUATION
Like stock market information,
technical indicator, trends from
internet, sentiment analysis,
financial news, company news

20. HOW AI-BASED
STOCK TRADING SOFTWARE WORKS
DATA
PREPROCESSING
MODEL
EVALUATION
EXECUTION
Formulate algorithm, neural
network, Graph/network, decision,
mathematical models, induction
rule sets

21. HOW AI-BASED
STOCK TRADING SOFTWARE WORKS
MODEL
EVALUATION
MONITOR
EXECUTION
Speed, frequency, holding
period, size of order, quantity of
order, buy at which price

22. HOW AI-BASED
STOCK TRADING SOFTWARE WORKS
MONITOR
EXECUTION
Objective function, performance
vs benchmark, It should be
trained with at regular interval
for lacking changing in market

23. FINANCIAL
ANALYSIS METHOD

24. Non-
Parametric
statistical
methods
Soft
computing
methods
Parametric
statistical
methods
FINANCIAL ANALYSIS METHOD

25. Parametric
statistical
methods
Non-
Parametric
statistical
methods
S
com
me
Discriminant
Analysis
Logistic
Regression
FINANCIAL ANALYSIS METHOD

26. S
com
me
Parametric
statistical
methods
Non-
Parametric
statistical
methods
Decision
Tree
Nearest
Neighbour
FINANCIAL ANALYSIS METHOD

27. Non-
Parametric
statistical
methods
etric
tical
ods
Soft
computing
methods
ARTIFICIAL
NEURAL
NETWORK
Genetic
algorithm
FINANCIAL ANALYSIS METHOD

28. Non-
Parametric
statistical
methods
Soft
computing
methods
Parametric
statistical
methods
FINANCIAL ANALYSIS METHOD

29. ARTIFICIAL
NEURAL
NETWORK

30. MEANING
A neuron is a vital component of ANN. These neurons are
linked together to form a graph-like structure, which is also
known as a network.
Artificial neurons accept input and generate output but are not
able to model automatically
STRUCTURE IMPACT CHALLENGES

31. MEANING STRUCTURE IMPACT CHALLENGES
ANN has a minimum of three layers of artificial
neurons: input, hidden and output as shown in Fig.

32. MEANING STRUCTURE IMPACT CHALLENGES
Improves Predictive Modeling
Portfolio Optimization
Enhanced Trading Strategies

33. MEANING
One difficulty is that ANNs can be complicated and difficult to
train. It is critical to have a solid understanding of ANNs and to
train them with high-quality data.
Another challenge is that ANNs can be overfitting to the
training data
STRUCTURE IMPACT CHALLENGES

34. STOCK MARKET PREDICTION THORUGH
ANN

35. ANALYZING
DIFFERENT
TYPES OF
AI-BASED
TRADING

36. ANALYZING
DIFFERENT
TYPES OF
AI-BASED
TRADING
Algorithmic Trading
Predictive Trading
High Frequency Trading

37. ANALYZING
DIFFERENT
TYPES OF
AI-BASED
TRADING
Algorithmic Trading
Leveraging computer algorithm to
execute trades automatically based
on rules and parameters.
Market, news, social media and news
data is analyzed in algorithmic
trading to predict future.
BENEFITS – Reduced transaction
cost, Lack of human error.

38. ANALYZING
DIFFERENT
TYPES OF
AI-BASED
TRADING
Predictive Trading
Use of AI and machine learning
algorithms to predict future market
movement.
Historical market and real time data
is analyzed in predictive trading to
predict market movement.
BENEFITS – Increased accuracy,
informed stock purchase decision

39. ANALYZING
DIFFERENT
TYPES OF
AI-BASED
TRADING
High Frequency Trading
Involves use of AI and advance
computer algorithm to execute trade
at high speeds and in high volume
HFT systems can process vast
amount of data and execute trades in
millisecond.
BENEFITS – Increased trading
opportunities, Reduce manual labour
cost, fast execution of trades.

40. IMPORTANCE OF
AI
IN REAL TIME STOCK TRADING
Reduced
research time
Predicting
pattern
Cost
reduction
Improved
accuracy

41. COMPARISION
BETWEEN
ARTIFICIAL
INTELLIGENCE
&
HUMAN
STOCK TRADING

42. INVOLVEMENT OF HUMAN EMOTION
AI-based trading eliminated the human
emotion involvement which helps to gain
edge while trading in different markets.
Human emotion create hindrance for traders
to earn profits due to poor psychology
management

43. FOLLOWING TRADING RULES
AI executes trades based on technical
indicators, price changes etc. for higher
accuracy.
In Human inexperience traders break rules
during trading resulting in continuous loses.

44. ABILITY TO MONITOR MULTIPLE MARKETS
In AI markets such as stocks, forex,
cryptocurrencies, can be analyzed simultaneously
by AI-based trading software.
Human cannot track move of multiple markets
resulting in low probability of earning profits.

45. ABILITY TO TAKE CONSISTENT TRADE
In AI continuous trading help trading
software to identify every market move and
gain profits.
Humans cannot analyze market on a
consistent basis which reduces ability to take
regular trades.

46. Human vs. AI –
A Duel of Benefits
and Pitfalls

47. PROS
Low cost alternate to
traditional human
advisor
CONS
Lack personalization
like human financial
advisor

48. CONS
Lack personalization
like human financial
advisor
PROS
Low cost alternate to
traditional human
advisor

49. PROS
Automated investment
administration without
human agent intervention
CONS
Difficult to keep
algorithms up to date in
changing market

50. CONS
Difficult to keep
algorithms up to date in
changing market
PROS
Automated investment
administration without
human agent intervention

51. PROS
Easy accessibility through
digital application
CONS
Vulnerable to cyber
attacks or data
breaches

52. CONS
Vulnerable to cyber
attacks or data
breaches
PROS
Easy accessibility through
digital application