Dr. Tucker Balch Associate Professor School of Interactive Computing CS 7646: Machine Learning for Trading Company Value Find out how modern electronic.

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Dr. Tucker Balch Associate Professor School of Interactive Computing CS 7646: Machine Learning for Trading Company Value Find out how modern electronic markets work, why stock prices change in the ways they do, and how computation can help our understanding of them. Learn to build algorithms and visualizations to inform investing practice. School of Interactive Computing

 Technical Analysis Price and volume only  Fundamental Analysis Financial statements P/E ratios, cash on hand, dividends Two General Approaches to Finding Value 2

 Weak: Prices reflect all past publicly available information. Prohibits profit from Technical Analysis  Semi-Strong: Weak + prices instantly change to reflect new public information. Prohibits profit from T.A. & Fundamental Analysis  Strong: Semi-Strong + prices instantly reflect even hidden or "insider" information. Prohibits profit from insider information  Efficient Markets Hypothesis: 3 Versions 3

Shiller, Robert (2005). Irrational Exuberance (2d ed.). Is the EMH True? 4

Cognitive biases such as overconfidence, overreaction, representative bias, information bias. Behavioral Economics: Argues Against EMH 5

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