Applicability of genetic algorithms for stock market prediction: A systematic survey of the last decade

Abstract

Stock market is one of the attractive domains for researchers as well as academicians. It represents highly complex non-linear fluctuating market behaviours where traders, investors, and organizers look forward to reliable future predictions of the market indices. Such prediction problems can be computationally addressed using various machine learning, deep learning, sentiment analysis, as well as mining approaches. However, the internal parameters configuration can play an important role in the prediction performance; also, feature selection is a crucial task. Therefore, to optimize such approaches, the evolutionary computation-based algorithms can be integrated in several ways. In this article, we systematically conduct a focused survey on genetic algorithm (GA) and its applications for stock market prediction; GAs are known for their parallel search mechanism to solve complex real-world problems; various genetic perspectives are also integrated with machine learning and deep learning methods to address financial forecasting. Thus, we aim to analyse the potential extensibility and adaptability of GAs for stock market prediction. We review stock price and stock trend prediction, as well as portfolio optimization, approaches over the recent years (2013–2022) to signify the state-of-the-art of GA-based optimization in financial markets. We broaden our discussion by briefly reviewing other genetic perspectives and their applications for stock market forecasting. We balance our survey with the consideration of competitiveness and complementation of GAs, followed by highlighting the challenges and potential future research directions of applying GAs for stock market prediction.