How do you think AI and machine learning will impact the future of trading?

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How do you think AI and machine learning will impact the future of trading?

Wanted to start a discussion on how these technologies are transforming our trading strategies.

Recently, there has been significant progress in using advanced machine learning models like neural networks and genetic algorithms to predict market movements and mitigate trading risks. For instance, a study from the University of Barcelona demonstrated that combining these technologies with volatility models can substantially enhance the accuracy of market predictions and reduce risks for traders​ (Tech Xplore)​.

Jason Johnson Answered question July 31, 2024
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Such studies are done in a conditional environment and half of the time these studies do not work in real-world scenarios. As per my understanding as a nontechnical individual, these bots and AIs are developed by humans. Humans do not possess the capability to design, predict, or change the future which is why we see movies based on time travel. I guess we will not see any such software that will hamper the future of trading even if they learn to adapt or learn with experience they will still commit errors causing loss to the trader. It is only the human mind that can learn from mistakes that can help a trader with the gained experience.

Jason Johnson Answered question July 31, 2024
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I wanted to outrightly condemn this idea because, just like bots that have been developed and upgraded for years, they are still not able to beat the market. Some will fail you almost immediately, while some will fail you later and others will just be earning and losing to the point that there will not be significant profits in the long run. For this, I am discouraged about these of bots.

Also, with AIs, judging by the ones I know now, they always shy away from giving market analysis and signals, they will only tell you how you can go about it. However, with the university experiment on a neural note, I think further progress may be possible. This will still not be perfect but I am certain that there will be a significant improvement compared to the bots garbagges that fill the internet.

Still, a good trader’s style must be observed for this to be possible.

Shabira Shafeek Answered question July 31, 2024
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