• Aceticon@lemmy.dbzer0.com
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    1 day ago

    Even then, and as I wrote in another post, a custom trading NN might be working a strategy which is fine under normal market conditions whilst leading to massive losses if those conditions change (i.e. “picking nickels in front of a steamroller”) and because of the black-box nature of how Neural Networks work and their tendency to end up with the outputs being very convoluted derivations of the inputs (I expect even more so in Markets, were the obvious strategies that humans can easilly spot have long been arbitraged away, so any patterns such an NN spots during training will be so convoluted as to not be detectable by most humans), nobody will spot the risky nature of that strategy until getting splattered.

    Neural Networks working in predicting market movements are, unlike a predictive text keyboard or even an automated train driver, not operating in a straightforward mainly non-adversarial enviroment.

    • KeenFlame@feddit.nu
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      10 hours ago

      Haha infact on the microsecond level that the bots work they employ dynamic tactics, just to achieve a goal and at their disposal they have the leverage of your entire pension. And your whole bank account. Yes. They bet your money. Right now. On millisecond trades. Continuously.

      The funny thing is that it DOES fail, sometimes they get caught in the steamroller, and then they halt the market and just prevent anyone from trading and go in to change all the daily lending deals to not have to deal with a bank run.

      Because the rules are for me and you, not for the gamer hedge fund bros. They are not bitches for no reason, they have to do this for work