The Role of Artificial Intelligence in Predicting Market Trends

Abstract

Financial sector, specifically around forecasting the market trends, was highly influenced by the Artificial Intelligence (AI) In these fluctuations and informational markets which information drives, AI is a tool that separates businesses, investors and policy makers between the winners and losers, with ability to analyze large volumes of data, identify trends and patterns and forecast, real-time, future market states. In this paper, we investigate some aspects of AI used for forecasting market trends, especially in the machine learning context: forecasting and opinion mining and categorization. In this analysis, we compare less sophisticated time series methods such as autoregressive models with the sophisticated AI time series techniques including neural networks and natural language processing. The research reveals that the AI models are comparatively more accurate and generalised than traditional methods, but questions are still there regarding data quality and understanding of developed models. For that reason, this research is a fine example which shows the significance of artificial intelligence in modern market prediction and presents some hints at the further development of the financial prognosis models.