Stock Exchange Trading Using Grid Pattern Optimized by A Genetic Algorithm with Speciation: The Case of S&P 500

This book presents a genetic algorithm that optimizes a grid template pattern detector in the SP 500, considering the open, high, and low prices during the testing period. The algorithm improves the results compared to other template approaches, with a return of 21.3% during testing.

Format: Paperback / softback
Length: 68 pages
Publication date: 09 July 2021
Publisher: Springer Nature Switzerland AG

This book presents a cutting-edge genetic algorithm that optimizes a grid template pattern detector to identify the most profitable trading point in the SP 500. The pattern detector is based on a template that utilizes a grid of weights with a fixed size. Unlike traditional methods that solely analyze the closing price, this template takes into account the open, high, and low values of the price during the testing period. Each cell in the grid is assigned a score, which is then optimized using an evolutionary genetic algorithm. This algorithm considers genetic diversity by implementing a speciation routine, allowing each individual in the population to adapt and thrive within its unique niche.

By incorporating this approach, the system is able to deliver superior results, outperforming other template approaches. The tests conducted involved real-world stock market data and compared them to state-of-the-art solutions, including those using a grid of weights with a variable size and non-speciated approaches. During the testing period, the presented solution achieved a remarkable return of 21.3%, significantly surpassing the 10.9% return of existing approaches. The use of speciation further enhanced the returns of certain results by taking into account genetic diversity.

In conclusion, this book showcases a groundbreaking genetic algorithm that revolutionizes the field of pattern detection in the stock market. By optimizing a grid template pattern detector, it enables traders to identify the most profitable trading points with greater accuracy and efficiency. The consideration of genetic diversity and speciation routines in the optimization process leads to improved returns and sets a new standard for investment strategies.

Weight: 147g
Dimension: 235 x 155 (mm)
ISBN-13: 9783030766795
Edition number: 1st ed. 2021