Application of Machine Learning Algorithms in Financial Market Risk Prediction

Abstract

AbstractThe financial industry has a fairly direct impact on our country’s economic development, and financial institutions are paying more and more attention to risk management. In order to reduce the risk rate, it is particularly important to predict the risk. Therefore, the prediction of financial market risks has always been an important direction of financial industry research. The purpose of this article is to explore the application of machine learning algorithms in financial market risk prediction. This paper analyzes the main characteristics of the financial market, explores the significance of financial market risk prediction, establishes a financial market risk prediction system based on machine learning algorithms, and explains the process of financial market risk prediction. Finally, experiments are carried out to verify the effectiveness of the financial market forecasting model proposed in this paper. Experimental data shows that the prediction success rate of the prediction model proposed in this study in the test set is 95.64%, which is only 0.54% away from the original 95.10% in the training set. It is a relatively successful prediction model.KeywordsRisk predictionMachine learningFinancial riskFinancial market