ExplainabilityTransparencyAccountabilitycs.CE
Stock Market Dynamics Through Deep Learning Context
Amirhossein Aminimehr, Amin Aminimehr, Hamid Moradi Kamali, Sauleh Eetemadi, Saeid Hoseinzade
May 16, 2024
arXiv.org
4 citations
1 influential
Key Takeaways
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Social media sentiment data can improve financial predictions: The study demonstrates that incorporating Twitter content alongside traditional market data produces more accurate stock market predictions than using historical data alone, suggesting that public sentiment captured on social platforms contains valuable predictive signals.
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Explainable AI reveals unexpected market drivers: Using LIME (a technique that makes AI decisions interpretable), the researchers identified that tweet volume—not traditional financial metrics—was the single most important factor driving market movements in their model, highlighting how AI transparency can surface surprising insights about real-world systems.
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Comprehensive data leads to better AI outcomes: The paper emphasizes that financial prediction models have historically suffered from incomplete feature sets, and their broader feature matrix (combining multiple data sources) produced more reliable results, suggesting that responsible AI development requires careful consideration of what information is included in training data.
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Explainability should be standard practice in high-stakes applications: By combining prediction with interpretability techniques, the researchers demonstrated a model for responsible AI in finance—a domain where decisions affect real people's money—showing that accuracy alone is insufficient without understanding why the model makes its predictions.
Abstract
Studies conducted on financial market prediction lack a comprehensive feature set that can carry a broad range of contributing factors; therefore, leading to imprecise results. Furthermore, while cooperating with the most recent innovations in explainable AI, studies have not provided an illustrative summary of market-driving factors using this powerful tool. Therefore, in this study, we propose a novel feature matrix that holds a broad range of features including Twitter content and market historical data to perform a binary classification task of one step ahead prediction. The utilization of our proposed feature matrix not only leads to improved prediction accuracy when compared to existing feature representations, but also its combination with explainable AI allows us to introduce a fresh analysis approach regarding the importance of the market-driving factors included. Thanks to the Lime interpretation technique, our interpretation study shows that the volume of tweets is the most important factor included in our feature matrix that drives the market's movements.
Paper Info
arXiv ID2405.09932
PublishedMay 16, 2024
Citations
4
Influential
1
Relevance65%
VenuearXiv.org
TypeJournalArticle
Categorycs.CE
Responsible AI Topics
ExplainabilityTransparencyAccountability
Links
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