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What are the best tools to use for quant advanced neural networks?

(Last Updated On: September 17, 2010)

What are the best tools to use for quant advanced neural networks?
This was a discussion found on Linked In:
I use neuroshell by ward systems. I don’t implement it’s trading signals religiously, though. I do use it as the basis for my trades and reccommendations athttp://www.cotsignals.com . You can see some examples of how I use it. I combine a neural network trigger with commitment of traders data.
have been using feedforward backpropagation neural network with partial recurrency. The latter facilitates the convergence at the expense of “rocky” error surface. I find ANN’s as a fantastic non-linear regression tool. However, the secret is not really in the regression tool but, obviously, the inputs you are feeding into it. I use jitter and a number of other techniques to enforce generalisation (i.e. prevent curve fitting). I use certain decomposition techniques on the input distribution of returns and look at thick tails, apart from other things, to detect regime shifts. Overall, I am a big fan of ANN’s, however, the majority of the models based on the I have seen so far fail miserably which makes perfect sense. My advice would be to take the majority of the models with a grain of salt, respect and understand leveraged trend-followers and technical traders, because if you get your model(s) right, they will be funding your R&D and perhaps a bit more! 🙂 One other thing to bear in mind is that human brain has the luxury of 10^11 degrees of freedom — the trick is to use at least some of them to co-operate with much simpler ANN-based models!

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