Combining Technical Analysis and Neural Networks in the Australian Stockmarket

B. Vanstone and G. Finnie (Australia)


Stockmarket, Trading, Neural Networks


One of the greatest difficulties facing a stock trader or investment manager is the stock selection process. In this process, the investor is faced with a large number of competing investments, and a fixed amount of capital. The goal is to spread the available capital across a reduced subset of the competing investments, with the aim of increasing the return. Typically, the investor relies on one of two main frameworks to guide the selection process, namely Fundamental Analysis, and Technical Analysis. This paper focuses on Technical Analysis, and implements a neural network which supports the stock selection process.

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