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Machine Learning for Finance

You're reading from   Machine Learning for Finance Principles and practice for financial insiders

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Product type Paperback
Published in May 2019
Publisher Packt
ISBN-13 9781789136364
Length 456 pages
Edition 1st Edition
Languages
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Authors (2):
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Jannes Klaas Jannes Klaas
Author Profile Icon Jannes Klaas
Jannes Klaas
James Le James Le
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James Le
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Table of Contents (15) Chapters Close

Machine Learning for Finance
Contributors
Preface
Other Books You May Enjoy
1. Neural Networks and Gradient-Based Optimization 2. Applying Machine Learning to Structured Data FREE CHAPTER 3. Utilizing Computer Vision 4. Understanding Time Series 5. Parsing Textual Data with Natural Language Processing 6. Using Generative Models 7. Reinforcement Learning for Financial Markets 8. Privacy, Debugging, and Launching Your Products 9. Fighting Bias 10. Bayesian Inference and Probabilistic Programming Index

Causal learning


This book is by and large a book about statistical learning. Given data X and targets Y, we aim to estimate , the distribution of target values given certain data points. Statistical learning allows us to create a number of great models with useful applications, but it doesn't allow us to claim that X being x caused Y to be y.

This statement is critical if we intend to manipulate X. For instance, if we want to know whether giving insurance to someone leads to them behaving recklessly, we are not going to be satisfied with the statistical relationship that people with insurance behave more reckless than those without. For instance, there could be a self-selection bias present about the number of reckless people getting insurance, while those who are not marked as reckless don't.

Judea Pearl, a famous computer scientist, invented a notation for causal models called do-calculus; we are interested in , which is the probability of someone behaving recklessly after we manipulated...

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