Artificial Intelligence Potential on Trading Systems.
Posted on the 14 January 2012 by Rodrigosucupira
@rodrigosucupira
Artificial intelligence (AI) really has a potential when weare seeking to improve the performance of trading systems. The most commonapplications of AI to trading systems is aimed at optimizing the parameters ofa particular strategy. An example is the use of genetic algorithms.AI algorithms are so called because they have anorganization inspired by biological processes. The diversity of algorithmsclassified as AI is significant and they, effectively, seek to enhance the strategyby optimizations and combinations.The genetic algorithm, for example, has an ability toexplore the solutions more efficiently than traditional methods, avoiding biason the process of optimizing the system, for not having properly considered thesolutions.There are also algorithms, genetic programming, which havethe ability to combine logic, such as blocks, assembling and reassembling apuzzle at a level of complexity above an optimization strategy only.The AI also has a fascination and power. His argument mustbe backed by performance improvements. The application must be systematicallyanalyzed and validated properly. Given the peculiarities of each system, it´snecessary to clarify possible sources of inaccuracies.