Ping-Chen Lin of the National Kaohsiung University of Applied Sciences in Kaohsiung and Jiah-Shing Chen of the National Central University, Jhongli, in Taiwan, explain how the financial status of any company can be of interest not only to its owners and employees but to a range of creditors, stockholders, banks, and individual investors. However, there are so many changing and interconnected factors that can lead to success or failure that it is usually considered an impossible task to predict whether a company will fail.
The researchers have now borrowed some of the principles of evolutionary biology to come up with a computer algorithm to make such predictions possible. They feed different variables, such as earnings per share, liabilities and net income, into their genetic-based hybrid algorithm, which assigns a weighting to each value. The output of the algorithm is a new set of variables that are then selected for how well they fit the next set of financial results from the company. Those that fail are discarded, or reduced in weight, and those that match the actual results more closely are fed back into the algorithm for the next round.
By using actual data from successful and failed companies and feeding this into the algorithm the researchers build up the fittest set of variables and weightings. This allows the algorithm to evolve so that it can then predict the financial future of any given company based on current income and expenditure, and tax obligations.
The team has blind tested the predictive power of their system on several companies successfully. "Our experimental results show that this hybrid approach obtains better prediction performance than when using a single approach effectively," the researchers say.
Albert Ang | alfa
Blockchain Set to Transform the Financial Services Market
28.09.2016 | HHL Leipzig Graduate School of Management
Paper or plastic?
08.07.2016 | University of Toronto
Researchers from the Institute for Quantum Computing (IQC) at the University of Waterloo led the development of a new extensible wiring technique capable of controlling superconducting quantum bits, representing a significant step towards to the realization of a scalable quantum computer.
"The quantum socket is a wiring method that uses three-dimensional wires based on spring-loaded pins to address individual qubits," said Jeremy Béjanin, a PhD...
In a paper in Scientific Reports, a research team at Worcester Polytechnic Institute describes a novel light-activated phenomenon that could become the basis for applications as diverse as microscopic robotic grippers and more efficient solar cells.
A research team at Worcester Polytechnic Institute (WPI) has developed a revolutionary, light-activated semiconductor nanocomposite material that can be used...
By forcefully embedding two silicon atoms in a diamond matrix, Sandia researchers have demonstrated for the first time on a single chip all the components needed to create a quantum bridge to link quantum computers together.
"People have already built small quantum computers," says Sandia researcher Ryan Camacho. "Maybe the first useful one won't be a single giant quantum computer...
COMPAMED has become the leading international marketplace for suppliers of medical manufacturing. The trade fair, which takes place every November and is co-located to MEDICA in Dusseldorf, has been steadily growing over the past years and shows that medical technology remains a rapidly growing market.
In 2016, the joint pavilion by the IVAM Microtechnology Network, the Product Market “High-tech for Medical Devices”, will be located in Hall 8a again and will...
'Ferroelectric' materials can switch between different states of electrical polarization in response to an external electric field. This flexibility means they show promise for many applications, for example in electronic devices and computer memory. Current ferroelectric materials are highly valued for their thermal and chemical stability and rapid electro-mechanical responses, but creating a material that is scalable down to the tiny sizes needed for technologies like silicon-based semiconductors (Si-based CMOS) has proven challenging.
Now, Hiroshi Funakubo and co-workers at the Tokyo Institute of Technology, in collaboration with researchers across Japan, have conducted experiments to...
14.10.2016 | Event News
14.10.2016 | Event News
12.10.2016 | Event News
21.10.2016 | Health and Medicine
21.10.2016 | Information Technology
21.10.2016 | Materials Sciences