Biologically Inspired Algorithms for Financial Modelling (Natural Computing Series) Review

Average Reviews:

(More customer reviews)In the ceaseless search for better modelling of financial instruments and economic events, one approach is to look for methods from mathematical biology as inspiration. Here, the main approaches studied include neural networks, genetic algorithms and ant colony modelling. The first two are perhaps the most widely used.

The key inspiration is to look into the future. The later sections of the book involve predicting various events, like a corporate failure. The efficacy of the biological methods for doing predictions is unclear. The book's results are intriguing, though.

There appear to be 2 audiences for the book. One is biologists or programmers already using those methods in biology, and who are looking at applying these to finance. The other audience is mathematicians in finance wanting more tools. Consequently, each audience will find different portions of the book useful. The explanation of conventional financial modelling is for the biologist, for example.

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Product Description:

Predicting the future for financial gain is a difficult, sometimes profitable activity. The focus of this book is the application of biologically inspired algorithms (BIAs) to financial modelling.In a detailed introduction, the authors explain computer trading on financial markets and the difficulties faced in financial market modelling. Then Part I provides a thorough guide to the various bioinspired methodologies - neural networks, evolutionary computing (particularly genetic algorithms and grammatical evolution), particle swarm and ant colony optimization, and immune systems. Part II brings the reader through the development of market trading systems. Finally, Part III examines real-world case studies where BIA methodologies are employed to construct trading systems in equity and foreign exchange markets, and for the prediction of corporate bond ratings and corporate failures.The book was written for those in the finance community who want to apply BIAs in financial modelling, and for computer scientists who want an introduction to this growing application domain.

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