Research on Financial Risk Prediction and Management Models Based on Big Data Analysis

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The increasing complexity and volatility of financial markets necessitate more advanced risk prediction and management techniques. Conventional financial risk models typically depend on linear assumptions and fixed statistical distributions, which constrain their capability to accurately reflect complex market behaviors. Recent advancements in big data analytics and deep learning provide new opportunities for more precise and adaptive risk assessment. This research introduces a novel framework for financial risk prediction that combines deep learning, probabilistic modeling, and reinforcement learning-driven risk management. Unlike conventional econometric models, our approach employs a risk-aware deep learning model (RDLM) to capture nonlinear dependencies among financial indicators while leveraging probabilistic estimation to quantify uncertainty in risk predictions. We introduce an adaptive risk mitigation strategy (ARMS), which dynamically adjusts risk exposure through reinforcement learning and market-responsive portfolio optimization. RDLM integrates deep neural networks with probabilistic risk estimation to enhance prediction accuracy and interpretability. By focusing on financial risk distributions instead of point estimates, this method effectively measures uncertainty, leading to more reliable risk evaluations. To enhance transparency and address critical regulatory issues, explainable AI methods like SHAP and LIME are utilized. ARMS leverages reinforcement learning and real-time data processing to dynamically refine investment strategies. The model includes market-regime detection. This allows it to adjust portfolio allocations as risk conditions change, ensuring adaptability in volatile environments. Experimental evaluations on real-world financial datasets demonstrate the effectiveness of our approach in enhancing risk prediction accuracy, minimizing financial losses, and optimizing risk-adjusted returns. The proposed framework combines big data analytics, deep learning, and adaptive risk management, providing a scalable and interpretable solution for financial stability and decision-making.