PredictionA prediction (Latin præ-, "before," and dicere, "to say"), or forecast, is a statement about a future event or data. They are often, but not always, based upon experience or knowledge. There is no universal agreement about the exact difference from "estimation"; different authors and disciplines ascribe different connotations. Future events are necessarily uncertain, so guaranteed accurate information about the future is impossible. Prediction can be useful to assist in making plans about possible developments.
Financial riskFinancial risk is any of various types of risk associated with financing, including financial transactions that include company loans in risk of default. Often it is understood to include only downside risk, meaning the potential for financial loss and uncertainty about its extent. A science has evolved around managing market and financial risk under the general title of modern portfolio theory initiated by Harry Markowitz in 1952 with his article, "Portfolio Selection".
RiskIn simple terms, risk is the possibility of something bad happening. Risk involves uncertainty about the effects/implications of an activity with respect to something that humans value (such as health, well-being, wealth, property or the environment), often focusing on negative, undesirable consequences. Many different definitions have been proposed. The international standard definition of risk for common understanding in different applications is "effect of uncertainty on objectives".
Reward systemThe reward system (the mesocorticolimbic circuit) is a group of neural structures responsible for incentive salience (i.e., "wanting"; desire or craving for a reward and motivation), associative learning (primarily positive reinforcement and classical conditioning), and positively-valenced emotions, particularly ones involving pleasure as a core component (e.g., joy, euphoria and ecstasy). Reward is the attractive and motivational property of a stimulus that induces appetitive behavior, also known as approach behavior, and consummatory behavior.
Empirical risk minimizationEmpirical risk minimization (ERM) is a principle in statistical learning theory which defines a family of learning algorithms and is used to give theoretical bounds on their performance. The core idea is that we cannot know exactly how well an algorithm will work in practice (the true "risk") because we don't know the true distribution of data that the algorithm will work on, but we can instead measure its performance on a known set of training data (the "empirical" risk).
Behavioral addictionBehavioral addiction is a form of addiction that involves a compulsion to engage in a rewarding non-substance-related behavior – sometimes called a natural reward – despite any negative consequences to the person's physical, mental, social or financial well-being. Addiction canonically refers to substance abuse; however, the term's connotation has been expanded to include behaviors that may lead to a reward (such as gambling, eating, or shopping) since the 1990s.
Model organismA model organism (often shortened to model) is a non-human species that is extensively studied to understand particular biological phenomena, with the expectation that discoveries made in the model organism will provide insight into the workings of other organisms. Model organisms are widely used to research human disease when human experimentation would be unfeasible or unethical. This strategy is made possible by the common descent of all living organisms, and the conservation of metabolic and developmental pathways and genetic material over the course of evolution.
Risk aversionIn economics and finance, risk aversion is the tendency of people to prefer outcomes with low uncertainty to those outcomes with high uncertainty, even if the average outcome of the latter is equal to or higher in monetary value than the more certain outcome. Risk aversion explains the inclination to agree to a situation with a more predictable, but possibly lower payoff, rather than another situation with a highly unpredictable, but possibly higher payoff.
Mean squared errorIn statistics, the mean squared error (MSE) or mean squared deviation (MSD) of an estimator (of a procedure for estimating an unobserved quantity) measures the average of the squares of the errors—that is, the average squared difference between the estimated values and the actual value. MSE is a risk function, corresponding to the expected value of the squared error loss. The fact that MSE is almost always strictly positive (and not zero) is because of randomness or because the estimator does not account for information that could produce a more accurate estimate.
Risk assessmentRisk assessment determines possible mishaps, their likelihood and consequences, and the tolerances for such events. The results of this process may be expressed in a quantitative or qualitative fashion. Risk assessment is an inherent part of a broader risk management strategy to help reduce any potential risk-related consequences. More precisely, risk assessment identifies and analyses potential (future) events that may negatively impact individuals, assets, and/or the environment (i.e. hazard analysis).
Mean absolute percentage errorThe mean absolute percentage error (MAPE), also known as mean absolute percentage deviation (MAPD), is a measure of prediction accuracy of a forecasting method in statistics. It usually expresses the accuracy as a ratio defined by the formula: where At is the actual value and Ft is the forecast value. Their difference is divided by the actual value At. The absolute value of this ratio is summed for every forecasted point in time and divided by the number of fitted points n.
Genetically modified organismA genetically modified organism (GMO) is any organism whose genetic material has been altered using genetic engineering techniques. The exact definition of a genetically modified organism and what constitutes genetic engineering varies, with the most common being an organism altered in a way that "does not occur naturally by mating and/or natural recombination". A wide variety of organisms have been genetically modified (GM), from animals to plants and microorganisms.
Risk managementRisk management is the identification, evaluation, and prioritization of risks (defined in ISO 31000 as the effect of uncertainty on objectives) followed by coordinated and economical application of resources to minimize, monitor, and control the probability or impact of unfortunate events or to maximize the realization of opportunities.
PrimatePrimates are a diverse order of mammals. They are divided into the strepsirrhines, which include the lemurs, galagos, and lorisids, and the haplorhines, which include the tarsiers and the simians (monkeys, including apes and humans). Primates arose 85–55 million years ago first from small terrestrial mammals, which adapted to living in the trees of tropical forests: many primate characteristics represent adaptations to life in this challenging environment, including large brains, visual acuity, color vision, a shoulder girdle allowing a large degree of movement in the shoulder joint, and dextrous hands.
Radial basis functionIn mathematics a radial basis function (RBF) is a real-valued function whose value depends only on the distance between the input and some fixed point, either the origin, so that , or some other fixed point , called a center, so that . Any function that satisfies the property is a radial function. The distance is usually Euclidean distance, although other metrics are sometimes used. They are often used as a collection which forms a basis for some function space of interest, hence the name.
Reinforcement learningReinforcement learning (RL) is an area of machine learning concerned with how intelligent agents ought to take actions in an environment in order to maximize the notion of cumulative reward. Reinforcement learning is one of three basic machine learning paradigms, alongside supervised learning and unsupervised learning. Reinforcement learning differs from supervised learning in not needing labelled input/output pairs to be presented, and in not needing sub-optimal actions to be explicitly corrected.
HabenulaIn neuroanatomy, habenula (diminutive of Latin habena meaning rein) originally denoted the stalk of the pineal gland (pineal habenula; pedunculus of pineal body), but gradually came to refer to a neighboring group of nerve cells with which the pineal gland was believed to be associated, the habenular nucleus. The habenular nucleus is a set of well-conserved structures in all vertebrate animals. Currently, this term refers to this separate cell mass in the caudal portion of the dorsal diencephalon, known as the epithalamus, found in all vertebrates on both sides of the third ventricle.
Generalization errorFor supervised learning applications in machine learning and statistical learning theory, generalization error (also known as the out-of-sample error or the risk) is a measure of how accurately an algorithm is able to predict outcome values for previously unseen data. Because learning algorithms are evaluated on finite samples, the evaluation of a learning algorithm may be sensitive to sampling error. As a result, measurements of prediction error on the current data may not provide much information about predictive ability on new data.
Value at riskValue at risk (VaR) is a measure of the risk of loss of investment/Capital. It estimates how much a set of investments might lose (with a given probability), given normal market conditions, in a set time period such as a day. VaR is typically used by firms and regulators in the financial industry to gauge the amount of assets needed to cover possible losses. For a given portfolio, time horizon, and probability p, the p VaR can be defined informally as the maximum possible loss during that time after excluding all worse outcomes whose combined probability is at most p.
OrganismAn organism () is any biological living system that functions as an individual life form. All organisms are composed of cells (cell theory). The idea of organism is based on the concept of minimal functional unit of life. Three traits have been proposed to play the main role in qualification as an organism: noncompartmentability – structure that cannot be divided without its functionality loss, individuality – the entity has simultaneous holding of genetic uniqueness, genetic homogeneity and autonomy, distinctness – genetic information has to maintain open-system (a cell).
