Machine Learning Trading, Stock Market, and Chaos

Tali Soroker is a Financial Analyst at I Know First. Differences in the concepts of randomness and chaos are crucial in our abilities to make predictions about a system with such properties. A random system is unpredictable, as a given outcome does not rely on any previous event. A coin that is tossed seven times in a row, landing on heads each time, can be tossed an eighth time and the probability that it will land on heads again is still only 50%. Such stationary processes do not have a change in statistical properties over time and, therefore, cannot be predicted.