Description:FIELD OF INVENTION
[0001] Embodiments of the present disclosure relate to a field of trading of stocks and more particularly to a system and a method to automate trading of one or more stocks in a stock market.
BACKGROUND
[0002] The stock market refers to a collection of markets and exchanges where activities such as buying, selling, and issuing stocks of publicly held companies take place. A goal of the stock market is to facilitate raising capital for companies and provide a venue for investors to trade the stocks. Currently, the investors need to analyze a significant amount of data associated with the stocks to make decisions regarding buying and selling of the stocks, which is overwhelming for the investors. Also, trading strategies of the investors are affected by emotions of the investors, thereby leading to irrational trading decisions.
[0003] Further, developing and executing the trading strategies and managing risk requires continuous monitoring and quick decision-making, which is arduous for the investors. Furthermore, the investors have limitations in terms of time and availability to buy and sell the stocks, thereby limiting the earning prospects from the stock market. Moreover, the investors face difficulty in managing the stocks on par with a growing portfolio of the investors. Also, the lack of awareness of the investors regarding the stock market leads to inefficient trading practices, thereby causing monetary losses to the investors. Further, the investors face challenges in complying with financial regulations associated with trading due to a lack of documentation. Furthermore, the lack of information regarding the historical performance of the stocks prevents the investors from assessing viability of the stocks along with optimizing the portfolio.
[0004] Hence, there is a need for an improved system and method to automate trading of one or more stocks in a stock market to address the aforementioned issue(s).
OBJECTIVE OF THE INVENTION
[0005] An objective of the invention is to automate trading of one or more stocks in a stock market utilizing artificial intelligence.
BRIEF DESCRIPTION
[0006] In accordance with an embodiment of the present disclosure, a system to automate trading of one or more stocks in a stock market is provided. The system includes a processing subsystem hosted on a server and configured to execute on a network to control bidirectional communications among a plurality of modules. The processing subsystem includes a data acquisition module operatively coupled to an integrated database. The data acquisition module is configured to acquire a plurality of information from at least one user, and at least one web resource. The plurality of information includes one or more stocks owned by the at least one user, price of the one or more corresponding stocks, trading volume of the one or more corresponding stocks, financial news, one or more market conditions, one or more economic indicators, one or more social media sentiments. The data acquisition module is also configured to preprocess the plurality of information to obtain processed information by handling at least one of a missing value and an outlier. The data acquisition module is further configured to store the processed information obtained in the integrated database. The processing subsystem also includes a forecasting module operatively coupled to the data acquisition module. The forecasting module is configured to compare the price of the one or more corresponding stocks, and the trading volume of the one or more corresponding stocks with historical price of the one or more corresponding stocks, and historical trading volume of the one or more corresponding stocks respectively to identify one or more correlations. The forecasting module is also configured to forecast the price of the one or more corresponding stocks and the trading volume of the one or more corresponding stocks for a future instance based on the one or more correlations identified. The processing subsystem includes a risk assessment module operatively coupled to the forecasting module. The risk assessment module is configured to assess a risk factor associated with each of the one or more corresponding stocks based on at least one of a parameter including volatility, market sentiment, and historical performance of the one or more stocks. The processing subsystem also includes a trading strategy module operatively coupled to the risk assessment module. The trading strategy module is configured to generate at least one trading strategy based on the price of the one or more corresponding stocks forecasted and the risk factor of each of the one or more corresponding stocks assessed. The processing subsystem further includes an automated execution module operatively coupled to the trading strategy module. The automated execution module is configured to execute at least one trading operation based on the at least one trading strategy generated, thereby automating trading of the one or more stocks.
[0007] In accordance with another embodiment of the present disclosure, a method to automate trading of one or more stocks in a stock market is provided. The method includes acquiring, by a data acquisition module, a plurality of information from at least one user, and at least one web resource. The plurality of information includes one or more stocks owned by the at least one user, price of the one or more corresponding stocks, trading volume of the one or more corresponding stocks, financial news, one or more market conditions, one or more economic indicators, one or more social media sentiments. The method also includes preprocessing, by the data acquisition module, the plurality of information to obtain processed information by handling at least one of a missing value and an outlier. The method further includes storing, by the data acquisition module, the processed information obtained in the integrated database. The method also includes comparing, by a forecasting module, the price of the one or more corresponding stocks, and the trading volume of the one or more corresponding stocks with historical price of the one or more corresponding stocks, and historical trading volume of the one or more corresponding stocks respectively to identify one or more correlations. The method further includes forecasting, by the forecasting module, the price of the one or more corresponding stocks and the trading volume of the one or more corresponding stocks for a future instance based on the one or more correlations identified. The method also includes assessing, by a risk assessment module, a risk factor associated with each of the one or more corresponding stocks based on at least one of a parameter including volatility, market sentiment, and historical performance of the one or more stocks. The method further includes generating, by a trading strategy module, at least one trading strategy based on the price of the one or more corresponding stocks forecasted and the risk factor of each of the one or more corresponding stocks assessed. The method also includes executing, by an automated execution module, at least one trading operation based on the at least one trading strategy generated, thereby automating trading of the one or more stocks.
[0008] To further clarify the advantages and features of the present disclosure, a more particular description of the disclosure will follow by reference to specific embodiments thereof, which are illustrated in the appended figures. It is to be appreciated that these figures depict only typical embodiments of the disclosure and are therefore not to be considered limiting in scope. The disclosure will be described and explained with additional specificity and detail with the appended figures.
BRIEF DESCRIPTION OF THE DRAWINGS
[0009] The disclosure will be described and explained with additional specificity and detail with the accompanying figures in which:
[0010] FIG. 1 is a block diagram representation of a system to automate trading of one or more stocks in a stock market in accordance with an embodiment of the present disclosure;
[0011] FIG. 2 is a block diagram representation of one embodiment of the system of FIG. 1 in accordance with an embodiment of the present disclosure.
[0012] FIG. 3 is a schematic representation of an exemplary embodiment of the system of FIG. 1, in accordance with an embodiment of the present disclosure;
[0013] FIG. 4 is a block diagram of a computer or a server in accordance with an embodiment of the present disclosure;
[0014] FIG. 5a is a flow chart representing the steps involved in a method to automate trading of one or more stocks in a stock market in accordance with an embodiment of the present disclosure; and
[0015] FIG. 5b is a flow chart representing the continued steps involved in a method of FIG. 5a, in accordance with an embodiment of the present disclosure.
[0016] Further, those skilled in the art will appreciate that elements in the figures are illustrated for simplicity and may not have necessarily been drawn to scale. Furthermore, in terms of the construction of the device, one or more components of the device may have been represented in the figures by conventional symbols, and the figures may show only those specific details that are pertinent to understanding the embodiments of the present disclosure so as not to obscure the figures with details that will be readily apparent to those skilled in the art having the benefit of the description herein.
DETAILED DESCRIPTION
[0017] For the purpose of promoting an understanding of the principles of the disclosure, reference will now be made to the embodiment illustrated in the figures and specific language will be used to describe them. It will nevertheless be understood that no limitation of the scope of the disclosure is thereby intended. Such alterations and further modifications in the illustrated system, and such further applications of the principles of the disclosure as would normally occur to those skilled in the art are to be construed as being within the scope of the present disclosure.
[0018] The terms "comprises", "comprising", or any other variations thereof, are intended to cover a non-exclusive inclusion, such that a process or method that comprises a list of steps does not include only those steps but may include other steps not expressly listed or inherent to such a process or method. Similarly, one or more devices or sub-systems or elements or structures or components preceded by "comprises... a" does not, without more constraints, preclude the existence of other devices, sub-systems, elements, structures, components, additional devices, additional sub-systems, additional elements, additional structures, or additional components. Appearances of the phrase "in an embodiment", "in another embodiment" and similar language throughout this specification may, but not necessarily do, all refer to the same embodiment.
[0019] Unless otherwise defined, all technical and scientific terms used herein have the same meaning as commonly understood by those skilled in the art to which this disclosure belongs. The system, methods, and examples provided herein are only illustrative and not intended to be limiting.
[0020] In the following specification and the claims, reference will be made to a number of terms, which shall be defined to have the following meanings. The singular forms “a”, “an”, and “the” include plural references unless the context clearly dictates otherwise.
[0021] Embodiments of the present disclosure relate to a system and a method to automate trading of one or more stocks in a stock market. The system includes a processing subsystem hosted on a server and configured to execute on a network to control bidirectional communications among a plurality of modules. The processing subsystem includes a data acquisition module operatively coupled to an integrated database. The data acquisition module is configured to acquire a plurality of information from at least one user, and at least one web resource. The plurality of information includes one or more stocks owned by the at least one user, price of the one or more corresponding stocks, trading volume of the one or more corresponding stocks, financial news, one or more market conditions, one or more economic indicators, one or more social media sentiments. The data acquisition module is also configured to preprocess the plurality of information to obtain processed information by handling at least one of a missing value and an outlier. The data acquisition module is further configured to store the processed information obtained in the integrated database. The processing subsystem also includes a forecasting module operatively coupled to the data acquisition module. The forecasting module is configured to compare the price of the one or more corresponding stocks, and the trading volume of the one or more corresponding stocks with historical price of the one or more corresponding stocks, and historical trading volume of the one or more corresponding stocks respectively to identify one or more correlations. The forecasting module is also configured to forecast the price of the one or more corresponding stocks and the trading volume of the one or more corresponding stocks for a future instance based on the one or more correlations identified. The processing subsystem includes a risk assessment module operatively coupled to the forecasting module. The risk assessment module is configured to assess a risk factor associated with each of the one or more corresponding stocks based on at least one of a parameter including volatility, market sentiment, and historical performance of the one or more stocks. The processing subsystem also includes a trading strategy module operatively coupled to the risk assessment module. The trading strategy module is configured to generate at least one trading strategy based on the price of the one or more corresponding stocks forecasted and the risk factor of each of the one or more corresponding stocks assessed. The processing subsystem further includes an automated execution module operatively coupled to the trading strategy module. The automated execution module is configured to execute at least one trading operation based on the at least one trading strategy generated, thereby automating trading of the one or more stocks.
[0022] FIG. 1 is a block diagram representation of a system (10) to automate trading of one or more stocks in a stock market in accordance with an embodiment of the present disclosure. The system (10) includes a processing subsystem (20) hosted on a server (30) and configured to execute on a network (40) to control bidirectional communications among a plurality of modules. Further, in one embodiment, the server (30) may be a cloud-based server. In another embodiment, the server (30) may be a local server. In one example, the network (40) may be a private or public local area network (LAN) or wide area network (WAN), such as the Internet.
[0023] Further, in another embodiment, the network (40) may include both wired and wireless communications according to one or more standards and/or via one or more transport mediums. Furthermore, in one example, the network (40) may include wireless communications according to one of the 802.11 or Bluetooth specification sets, or another standard or proprietary wireless communication protocol. In yet another embodiment, the network (40) may also include communications over a terrestrial cellular network, including, a GSM (global system for mobile communications), CDMA (code division multiple access), and/or EDGE (enhanced data for global evolution) network. In one embodiment, an integrated database (50) may be operatively coupled to the plurality of modules to store data being processed by the integrated database (50). In some embodiments, the integrated database (50) may be a structured query language database. In a specific embodiment, the integrated database (50) may be a non-structured query language database. In one embodiment, the integrated database (50) may include a columnar database.
[0024] Furthermore, the processing subsystem (20) includes a data acquisition module (60) operatively coupled to the integrated database (50). The data acquisition module (60) is configured to acquire a plurality of information from at least one user, and at least one web resource. In one embodiment, the at least one web resource may include a web interface, one or more websites, a blog, an electronic news paper and the like. The plurality of information includes one or more stocks owned by the at least one user, price of the one or more corresponding stocks, trading volume of the one or more corresponding stocks, financial news, one or more market conditions, one or more economic indicators, one or more social media sentiments. In some embodiments, the one or more economic indicators may include gross domestic product (GDP), unemployment rate, inflation rate, consumer price index (CPI), producer price index (PPI), trade balance, current account balance, interest rates, consumer confidence index, business confidence index, housing starts, stock market indices, government debt-to-GDP ratio, labor force participation rate.
[0025] Moreover, in one embodiment, the one or more market conditions may include, bullish, bearish, sideways or range-bound, bull market, bear market, volatile, correction, recession, cyclical market, bullish, bearish divergence, neutral, flat, overbought, and oversold. In some embodiments, the one or more social media sentiments may include positive sentiments, negative sentiments and neutral sentiments. In such an embodiment, the positive sentiments may include optimism, excitement, and confidence. In one embodiment, the negative sentiments may include fear, anxiety, and skepticism. For example consider a scenario in which the at least one user X is an investor in one or more stock markets. The data acquisition module (60) may acquire the plurality of information regarding the one or more stocks owned by the at least one user X. The data acquisition module (60) may further acquire the price of the one or more corresponding stocks, the trading volume of the one or more corresponding stocks from the web interface associated with the one or more stock markets. Also, the data acquisition module (60) may acquire the plurality of information including the financial news about the one or more stocks, and the one or more market conditions, the one or more economic indicators, the one or more social media sentiments from the one or more websites.
[0026] Additionally, the data acquisition module (60) is also configured to preprocess the plurality of information to obtain processed information by handling at least one of a missing value and an outlier. The data acquisition module (60) is further configured to store the processed information obtained in the integrated database (50). In continuation with the ongoing example, consider the scenario in which the at least one user X owns the one or more stocks of a company Y. The price of the one or more stocks of the company Y and trading volume of the one or more stocks of the company Y acquired by the data acquisition module (60) may have the missing value at certain instances. The data acquisition module (60) may use at least one data prediction technique to replace the missing value with a corresponding feasible value. In such an embodiment, the data prediction technique may include curve fitting, interpolation, regression analysis, time series analysis, machine learning, kriging, splines, bootstrapping, forecasting and the like.
[0027] Also, the processing subsystem (20) includes a forecasting module (70) operatively coupled to the data acquisition module (60). The forecasting module (70) is configured to compare the price of the one or more corresponding stocks, and the trading volume of the one or more corresponding stocks with historical price of the one or more corresponding stocks, and historical trading volume of the one or more corresponding stocks respectively to identify one or more correlations. The forecasting module (70) is also configured to forecast the price of the one or more corresponding stocks and the trading volume of the one or more corresponding stocks for a future instance based on the one or more correlations identified. In continuation with the ongoing example, the forecasting module (70) may compare the price of the one or more stocks of the company Y, and the trading volume of the one or more stocks of the company Y with historical price of the one or more corresponding stocks of the company Y and historical trading volume of the one or more stocks of the company Y respectively to identify the one or more correlations. The forecasting module (70) may also configured to forecast the price of the one or more corresponding stocks of the company Y and the trading volume of the one or more corresponding stocks of the company Y for the future instance based on the one or more correlations identified.
[0028] Further, the processing subsystem (20) includes a risk assessment module (80) operatively coupled to the forecasting module (70). The risk assessment module (80) is configured to assess a risk factor associated with each of the one or more corresponding stocks based on at least one of a parameter including volatility, market sentiment, and historical performance of the one or more stocks. In continuation with the ongoing example, the risk assessment module (80) may be configured to assess the risk factor associated with the one or more corresponding stocks of the company Y based on the volatility of the one or more stocks of the company Y. The risk factor assessed by the risk assessment module (80) may be directly proportional to the volatility of the one or more stocks of the company Y.
[0029] Furthermore, the processing subsystem (20) includes a trading strategy module (90) operatively coupled to the risk assessment module (80). The trading strategy module (90) is configured to generate at least one trading strategy based on the price of the one or more corresponding stocks forecasted and the risk factor of each of the one or more corresponding stocks assessed. In one embodiment, the at least one trading strategy may include portfolio diversification, stop-loss order, and risk- adjusted position sizing. As used herein, the portfolio diversification may be defined as an investment strategy that involves spreading an investor's capital across a variety of different assets or asset classes to reduce risk and optimize the risk-return trade-off. As used herein, the stop-loss order may be defined as a risk management tool used in financial trading to limit potential losses on a trade position.
[0030] Moreover, as used herein, the risk adjusted position sizing may be defined as a strategy in portfolio management that involves determining the size of each investment position within a portfolio based on the level of risk associated with that particular position. In continuation with the ongoing example, consider the scenario in which average value of the one or more stocks of the company Y owned by the at least one user X may be 3 rupees. The price of the one or more stocks of the company Y forecasted by the forecasting module (70) may be between an upper limit of 3.5 rupees and a lower limit of 2.5 rupees. The risk factor of the one or more stocks of the company Y forecasted by the forecasting module (70) may be above a predefined threshold. In such a scenario, the trading strategy module (90) may set the stop loss order at the 3.5 rupees to yield maximum profit by selling the one or more corresponding stocks of the company Y.
[0031] Additionally, the processing subsystem (20) includes an automated execution module (100) operatively coupled to the trading strategy module (90). The automated execution module (100) is configured to execute at least one trading operation based on the at least one trading strategy generated, thereby automating trading of the one or more stocks. In one embodiment, the at least one trading operation may include buying the one or more stocks, selling the one or more stocks, and holding the one or more stocks. In some embodiments, the automated execution module (100) may be configured to manage placement of at least one of a buying order and a selling order of the one or more stocks based on trading cost, and liquidity of the one or more stocks. In continuation with the ongoing example, the automated execution module (100) may execute the stop loss order when price of the one or more corresponding stocks of the company Y touches 3.5 rupees to sell off the one or more corresponding stocks of the company Y.
[0032] FIG. 2 is a block diagram representation of one embodiment of the system (10) of FIG. 1 in accordance with an embodiment of the present disclosure. The system (10) of FIG. 1 includes the data acquisition module (60), the forecasting module (70), the risk assessment module (80), the trading strategy module (90), and the automated execution module (100). In one embodiment, the system (10) of FIG. 1 may include the processing subsystem (20) including a portfolio optimization module (110) configured to provide one or more recommendations to the at least one user to optimize a portfolio of the at least one user to increase profit by reducing risk. In such an embodiment, the one or more recommendations may include buying the one or more stocks, and selling the one or more stocks.
[0033] Further, in continuation with the ongoing example, consider the scenario in which, along with the one or more stocks of the company Y, the at least one user may also own the one or more stocks of a company Z. The portfolio optimization module (110) may assess that, price of the one or more stocks of the company Y may collapse compared to the one or more stocks of the company Z based on the price of the one or more stocks of the company Y forecasted, the price of the one or more stocks of the company Z forecasted, the risk factor of the one or more stocks of the company Y assessed, and the risk factor of the one or more stocks of the company Y assessed. In such an embodiment, the portfolio optimization module (110) may recommend the at least one user X to sell the one or more stocks of the company Y.
[0034] Furthermore, in one embodiment, the processing subsystem (20) may include an interactive module (120) configured to render a plurality of information in a user interface of a user device associated with the at least one user. In such an embodiment, the plurality of information may include performance of the one or more stocks, trade history, and one or more customization options. In one embodiment, the user device may include a phone, a computer, a personal digital assistant, a tab and the like. In some embodiments, the interactive module (120) may be configured to generate at least one of a performance report of the one or more stocks, trade summary of the one or more stocks and risk analysis report of the one or more stocks.
[0035] Moreover, in continuation with the ongoing example, the interactive module (120) may render the trade history of the one or more stocks of the company Y and the one or more stocks of the company Z in the user interface of the user device associated with the at least one user X. The interactive module (120) may also prepare performance reports of the one or more stocks of the company Y and the one or more stocks of the company Z based on one or more inputs received from the forecasting module (70), and the risk assessment module (80).
[0036] Additionally, in some embodiments, the processing subsystem (20) may include a training module (130) configured to train the at least one user for performing trading in one or more stock markets. In one embodiment, the trading may include, buying the one or more stocks, selling the one or more stocks, and the like. In continuation with the ongoing example the training module (130) may rain the at least one user X to perform the trading in the one or more stock markets.
[0037] Also, in a specific embodiment, the processing subsystem (20) may include a regulatory compliance module (140) configured to evaluate compliance of the at least one user with one or more financial regulations based on the one or more stocks owned by the at least one user. In such an embodiment, the regulatory compliance module (140) may be configured to provide one or more recommendations to the at least one user to comply with the one or more financial regulations when the at least one user is noncompliant with the one or more financial regulations upon evaluation. In one embodiment, the one or more financial regulations may include security exchange board of India regulations, listing agreements, trading regulations, take over codes, know your customer regulations, anti-money laundering regulations, margin trading regulations, delisting regulations, mutual fund regulations, corporate governance regulations, market abuse regulations and derivative trading regulations.
[0038] Further, in continuation with the ongoing example, the regulatory compliance module (140) may evaluate the compliance of the at least one user X with respect to the know your customer regulations. In detail, the regulatory complaince module (140) may check whether the know your customer verification for the at least on user X is completed. The regulatory compliance module (140) may provide the one or more recommendations to the at least one user X to get the know your customer verification done when the regulatory compliance module (140) identifies that the know your customer verification for the at least on user X is incomplete.
[0039] FIG. 3 is a schematic representation of an exemplary embodiment (150) of the system (10) of FIG. 1 in accordance with an embodiment of the present disclosure. For example consider a scenario in which the at least one user A (160) is the investor in stock markets. The data acquisition module (60) may acquire the plurality of information regarding the one or more stocks owned by the at least one user A (160). The data acquisition module (60) may further acquire the price of the one or more corresponding stocks, the trading volume of the one or more corresponding stocks from the web interface associated with the one or more stock markets. Also, the data acquisition module (60) may acquire the plurality of information including the financial news about the one or more stocks, and the one or more market conditions, the one or more economic indicators, the one or more social media sentiments from the one or more websites.
[0040] Further, consider the scenario in which the at least one user A (160) owns the one or more stocks of a company B. The price of the one or more stocks of the company B and trading volume of the one or more stocks of the company B acquired by the data acquisition module (60) may have the missing value at certain instances. The data acquisition module (60) may use the at least one data prediction technique to replace the missing value with the corresponding feasible value. The forecasting module (70) may compare the price of the one or more stocks of the company B, ant the trading volume of the one or more stocks of the company B with historical price of the one or more corresponding stocks of the company B and historical trading volume of the one or more stocks of the company B respectively to identify the one or more correlations. The forecasting module (70) may also configured to forecast the price of the one or more corresponding stocks of the company B and the trading volume of the one or more corresponding stocks of the company B for the future instance based on the one or more correlations identified.
[0041] Furthermore, the risk assessment module (80) may be configured to assess the risk factor associated with the one or more corresponding stocks of the company B based on the volatility of the one or more stocks of the company B. The average value of the one or more stocks of the company B owned by the at least one user A (160) may be 5 rupees. The price of the one or more stocks of the company B forecasted by the forecasting module (70) may be between an upper limit of 6 rupees and a lower limit of 4 rupees. The risk factor of the one or more stocks of the company B forecasted by the forecasting module (70) may be above a predefined threshold. In such a scenario, the trading strategy module (90) may set the stop loss order at the 6 rupees to yield maximum profit by selling the one or more corresponding stocks of the company B.
[0042] Moreover, the automated execution module (100) may execute the stop loss order when price of the one or more corresponding stocks of the company B reaches 6 rupees to sell off the one or more corresponding stocks of the company B. Consider the scenario in which along with the one or more stocks of the company B, the at least one user A (160) may also own the one or more stocks of a company C. Assessment by the portfolio optimization module (110) may predict that, price of the one or more stocks of the company B may collapse compared to the one or more stocks of the company C based on the price of the one or more stocks of the company B forecasted, the price of the one or more stocks of the company C forecasted, the risk factor of the one or more stocks of the company B assessed, and the risk factor of the one or more stocks of the company B assessed. In such an embodiment, the portfolio optimization module (110) may recommend the at least one user A (160) to sell the one or more stocks of the company B.
[0043] Additionally, the interactive module (120) may render the trade history of the one or more stocks of the company B and the one or more stocks of the company C in the user interface of the user device associated with the at least one user A (160). The interactive module (120) may also prepare performance reports of the one or more stocks of the company B and the one or more stocks of the company C based on one or more inputs received from the forecasting module (70), and the risk assessment module (80). The training module (130) may train the at least one user A (160) to perform the trading in the one or more stock markets. The regulatory compliance module (140) may evaluate the compliance of the at least one user A (160) with respect to the know your customer regulations. In detail, the regulatory compliance module (140) may check whether the know your customer verification for the at least one user A (160) is completed. The regulatory compliance module (140) may provide the one or more recommendations to the at least one user A (160) to get the know your customer verification done when the regulatory compliance module (140) identifies that the know your customer verification for the at least on user A (160) is incomplete.
[0044] FIG. 4 is a block diagram of a computer or a server (30) in accordance with an embodiment of the present disclosure. The server (30) includes processor(s) (190), and memory (200) operatively coupled to the bus (210). The processor(s) (190), as used herein, includes any type of computational circuit, such as, but not limited to, a microprocessor, a microcontroller, a complex instruction set computing microprocessor, a reduced instruction set computing microprocessor, a very long instruction word microprocessor, an explicitly parallel instruction computing microprocessor, a digital signal processor, or any other type of processing circuit, or a combination thereof.
[0045] The memory (200) includes several subsystems stored in the form of executable program which instructs the processor to perform the method steps illustrated in FIG. 1. The memory (200) is substantially similar to the system (10) of FIG.1. The memory (200) has the following subsystems: the processing subsystem (20) including the data acquisition module (60), the forecasting module (70), the risk assessment module (80), the trading strategy module (90), the automated execution module (100), the portfolio optimization module (110), the interactive module (120), the training module (130) and the regulatory compliance module (140). The plurality of modules of the processing subsystem (20) performs the functions as stated in FIG. 1 and FIG. 2. The bus (210) as used herein refers to be the internal memory channels or computer network that is used to connect computer components and transfer data between them. The bus (210) includes a serial bus or a parallel bus, wherein the serial bus transmit data in bit-serial format and the parallel bus transmit data across multiple wires. The bus (210) as used herein, may include but not limited to, a system bus, an internal bus, an external bus, an expansion bus, a frontside bus, a backside bus, and the like.
[0046] The processing subsystem (20) includes a data acquisition module (60) operatively coupled to an integrated database (50). The data acquisition module (60) is configured to acquire a plurality of information from at least one user, and at least one web resource. The plurality of information includes one or more stocks owned by the at least one user, price of the one or more corresponding stocks, trading volume of the one or more corresponding stocks, financial news, one or more market conditions, one or more economic indicators, one or more social media sentiments. The data acquisition module (60) is also configured to preprocess the plurality of information to obtain processed information by handling at least one of a missing value and an outlier. The data acquisition module (60) is further configured to store the processed information obtained in the integrated database (50). The processing subsystem (20) also includes a forecasting module (70) operatively coupled to the data acquisition module (60). The forecasting module (70) is configured to compare the price of the one or more corresponding stocks, and the trading volume of the one or more corresponding stocks with historical price of the one or more corresponding stocks, and historical trading volume of the one or more corresponding stocks respectively to identify one or more correlations. The forecasting module (70) is also configured to forecast the price of the one or more corresponding stocks and the trading volume of the one or more corresponding stocks for a future instance based on the one or more correlations identified. The processing subsystem (20) includes a risk assessment module (80) operatively coupled to the forecasting module (70). The risk assessment module (80) is configured to assess a risk factor associated with each of the one or more corresponding stocks based on at least one of a parameter including volatility, market sentiment, and historical performance of the one or more stocks. The processing subsystem (20) also includes a trading strategy module (90) operatively coupled to the risk assessment module (80). The trading strategy module (90) is configured to generate at least one trading strategy based on the price of the one or more corresponding stocks forecasted and the risk factor of each of the one or more corresponding stocks assessed. The processing subsystem (20) further includes an automated execution module (100) operatively coupled to the trading strategy module (90). The automated execution module (100) is configured to execute at least one trading operation based on the at least one trading strategy generated, thereby automating trading of the one or more stocks.
[0047] The processing subsystem (20) also includes a portfolio optimization module (110) configured to provide one or more recommendations to the at least one user to optimize a portfolio of the at least one user to increase profit by reducing risk. The one or more recommendations includes buying the one or more stocks and selling the one or more stocks.
[0048] The processing subsystem (20) also includes an interactive module (120) configured to render a plurality of information in a user interface of a user device associated with the at least one user. The plurality of information includes performance of the one or more stocks, trade history, and one or more customization options. The interactive module (120) is configured to generate at least one of a performance report of the one or more stocks, trade summary of the one or more stocks and risk analysis report of the one or more stocks.
[0049] The processing subsystem (20) also includes a training module (130) configured to train the at least one user for performing trading in one or more stock markets.
[0050] The processing subsystem (20) also includes a regulatory compliance module (140) configured to evaluate compliance of the at least one user with one or more financial regulations based on the one or more stocks owned by the at least one user. The regulatory compliance module (140) is also configured to provide one or more recommendations to the at least one user to comply with the one or more financial regulations when the at least one user is noncompliant with the one or more financial regulations upon evaluation.
[0051] Computer memory elements may include any suitable memory device(s) for storing data and executable program, such as read only memory, random access memory, erasable programmable read only memory, electrically erasable programmable read only memory, hard drive, removable media drive for handling memory cards and the like. Embodiments of the present subject matter may be implemented in conjunction with program modules, including functions, procedures, data structures, and application programs, for performing tasks, or defining abstract data types or low-level hardware contexts. Executable program stored on any of the above-mentioned storage media may be executable by the processor(s) (190).
[0052] FIG. 5a-5b is a flow chart representing the steps involved in a method (300) to automate trading of one or more stocks in a stock market in accordance with an embodiment of the present disclosure. The method (300) includes acquiring a plurality of information from at least one user, and at least one web resource in step 310. In one embodiment, acquiring a plurality of information from at least one user, and at least one web resource includes acquiring a plurality of information from at least one user, and at least one web resource by a data acquisition module.
[0053] Further, the plurality of information includes one or more stocks owned by at least one user, price of the one or more corresponding stocks, trading volume of the one or more corresponding stocks, financial news, one or more market conditions, one or more economic indicators, one or more social media sentiments. In one embodiment, the at least one web resource may include a web interface, one or more websites, a blog, an electronic news paper and the like. In one embodiment, the one or more market conditions may include, bullish, bearish, sideways or range-bound, bull market, bear market, volatility, correction, recession, cyclical market, bullish, bearish divergence, neutral, flat, overbought, and oversold. In some embodiments, the one or more social media sentiments may include positive sentiments, negative sentiments and neutral sentiments. In such an embodiment, the positive sentiments may include optimism, excitement, and confidence. In one embodiment, the negative sentiments may include fear, anxiety, and skepticism.
[0054] The method (300) also includes preprocessing the plurality of information to obtain processed information by handling at least one of a missing value and an outlier in step 320. In one embodiment, preprocessing the plurality of information to obtain processed information by handling at least one of a missing value and an outlier includes preprocessing the plurality of information to obtain processed information by handling at least one of a missing value and an outlier by the data acquisition module.
[0055] The method (300) also includes storing the processed information obtained in the integrated database in step 330. In one embodiment, storing the processed information obtained in the integrated database includes storing the processed information obtained in the integrated database by the data acquisition module.
[0056] The method (300) also includes comparing the price of the one or more corresponding stocks, and the trading volume of the one or more corresponding stocks with historical price of the one or more corresponding stocks, and historical trading volume of the one or more corresponding stocks respectively to identify one or more correlations in step 340. In one embodiment, comparing the price of the one or more corresponding stocks, and the trading volume of the one or more corresponding stocks with historical price of the one or more corresponding stocks, and historical trading volume of the one or more corresponding stocks respectively to identify one or more correlations includes comparing the price of the one or more corresponding stocks, and the trading volume of the one or more corresponding stocks with historical price of the one or more corresponding stocks, and historical trading volume of the one or more corresponding stocks respectively to identify one or more correlations by a forecasting module.
[0057] The method (300) also includes forecasting the price of the one or more corresponding stocks and the trading volume of the one or more corresponding stocks for a future instance based on the one or more correlations identified in step 350. In one embodiment, forecasting the price of the one or more corresponding stocks and the trading volume of the one or more corresponding stocks for a future instance based on the one or more correlations identified includes forecasting the price of the one or more corresponding stocks and the trading volume of the one or more corresponding stocks for a future instance based on the one or more correlations identified by the forecasting module.
[0058] The method (300) also includes assessing a risk factor associated with each of the one or more corresponding stocks based on at least one of a parameter comprising volatility, market sentiment, and historical performance of the one or more stocks in step 360. In one embodiment, assessing a risk factor associated with each of the one or more corresponding stocks based on at least one of a parameter comprising volatility, market sentiment, and historical performance of the one or more stocks includes assessing a risk factor associated with each of the one or more corresponding stocks based on at least one of a parameter comprising volatility, market sentiment, and historical performance of the one or more stocks by a risk assessment module.
[0059] The method (300) also includes generating at least one trading strategy based on the price of the one or more corresponding stocks forecasted and the risk factor of each of the one or more corresponding stocks assessed in step 370. In one embodiment, generating at least one trading strategy based on the price of the one or more corresponding stocks forecasted and the risk factor of each of the one or more corresponding stocks assessed includes generating at least one trading strategy based on the price of the one or more corresponding stocks forecasted and the risk factor of each of the one or more corresponding stocks assessed by a trading strategy module. In one embodiment, the at least one trading strategy may include portfolio diversification, stop-loss order, and risk- adjusted position sizing.
[0060] The method (300) also includes executing at least one trading operation based on the at least one trading strategy generated, thereby automating trading of the one or more stocks in step 380. In one embodiment, executing at least one trading operation based on the at least one trading strategy generated includes executing at least one trading operation based on the at least one trading strategy generated by an automated execution module. In one embodiment, the at least one trading operation may include buying the one or more stocks, selling the one or more stocks, and holding the one or more stocks.
[0061] Various embodiments of the system and method to automate trading of one or more stocks in a stock market described above enable various advantages. The data acquisition module is capable of acquiring the plurality of information from the at least one user, and the at least one web resource regarding the one or more stocks owned by the at least one user, the price of the one or more corresponding stocks, the trading volume of the one or more corresponding stocks, the financial news, the one or more market conditions, the one or more economic indicators, and the one or more social media sentiments, thereby supporting the comprehensive information gathering. The forecasting module is capable of forecasting the price of the one or more corresponding stocks and the trading volume of the one or more corresponding stocks for the future instance based on the one or more correlations identified, thereby supporting strategic decision making.
[0062] Further, the risk assessment module is capable of assessing risk factor associated with each of the one or more corresponding stocks based on at least one of the parameter including volatility, market sentiment, and historical performance of the one or more stocks, thereby assessing risk associated with the one or more stocks. The trading strategy module is capable of generating the at least one trading strategy based on the price of the one or more corresponding stocks forecasted and the risk factor of each of the one or more corresponding stocks assessed, thereby devising the at least one trading strategy irrespective of any emotions of the investors to enhance the trading efficiency.
[0063] Furthermore, the automated execution module is capable of executing the at least one trading operation based on the at least one trading strategy generated irrespective of any time limitations, thereby maximizing yield for the at least one user. The portfolio optimization module is capable of providing the one or more recommendations to the at least one user to optimize the portfolio of the at least one user to increase profit by reducing risk, thereby helping the at least one user to manage the portfolio associated with the at least one user effectively irrespective of the size of the portfolio.
[0064] Moreover, the interactive module is capable of rendering the plurality of information in the user interface of the user device associated with the at least one user, thereby helping the at least one user to make informed decisions. The training module is capable of training the at least one user to perform the trading, thereby enabling the at least one user to trade efficiently. The regulatory compliance module is capable of providing the one or more recommendations to the at least one user to to comply with the one or more financial regulations when the at least one user is noncompliant with the one or more financial regulations upon evaluation, thereby helping the at least one user to comply with the one or more financial regulations.
[0065] It will be understood by those skilled in the art that the foregoing general description and the following detailed description are exemplary and explanatory of the disclosure and are not intended to be restrictive thereof. While specific language has been used to describe the disclosure, any limitations arising on account of the same are not intended.
[0066] The figures and the foregoing description give examples of embodiments. Those skilled in the art will appreciate that one or more of the described elements may well be combined into a single functional element. Alternatively, certain elements may be split into multiple functional elements. Elements from one embodiment may be added to another embodiment. For example, the order of processes described herein may be changed and are not limited to the manner described herein. Moreover, the actions of any flow diagram need not be implemented in the order shown; nor do all the acts need to be necessarily performed. Also, those acts that are not dependent on other acts may be performed in parallel with the other acts. The scope of embodiments is by no means limited by these specific examples.
, Claims:1. A system (10) to automate trading of one or more stocks in a stock market comprising:
characterized in that:
a processing subsystem (20) hosted on a server (30) and configured to execute on a network (40) to control bidirectional communications among a plurality of modules comprising:
a data acquisition module (60) operatively coupled to an integrated database (50), wherein the data acquisition module (60) is configured to:
acquire a plurality of information from the at least one user, and at least one web resource, wherein the plurality of information comprises one or more stocks owned by the at least one user, price of the one or more corresponding stocks, trading volume of the one or more corresponding stocks, financial news, one or more market conditions, one or more economic indicators, one or more social media sentiments;
preprocess the plurality of information to obtain processed information by handling at least one of a missing value and an outlier;
store the processed information obtained in the integrated database (50);
a forecasting module (70) operatively coupled to the data acquisition module (60), wherein the forecasting module (70) is configured to:
compare the price of the one or more corresponding stocks, and the trading volume of the one or more corresponding stocks with historical price of the one or more corresponding stocks, and historical trading volume of the one or more corresponding stocks respectively to identify one or more correlations;
forecast the price of the one or more corresponding stocks and the trading volume of the one or more corresponding stocks for a future instance based on the one or more correlations identified;
a risk assessment module (80) operatively coupled to the forecasting module (70), wherein the risk assessment module (80) is configured to assess a risk factor associated with each of the one or more corresponding stocks based on at least one of a parameter comprising volatility, market sentiment, and historical performance of the one or more stocks;
a trading strategy module (90) operatively coupled to the risk assessment module (80), wherein the trading strategy module (90) is configured to generate at least one trading strategy based on the price of the one or more corresponding stocks forecasted and the risk factor of each of the one or more corresponding stocks assessed; and
an automated execution module (100) operatively coupled to the trading strategy module (90), wherein the automated execution module (100) is configured to execute at least one trading operation based on the at least one trading strategy generated, thereby automating trading of the one or more stocks.
2. The system (10) as claimed in claim 1, wherein the at least one trading strategy comprises portfolio diversification, stop-loss order, and risk- adjusted position sizing.
3. The system (10) as claimed in claim 1, wherein the at least one trading operation comprises buying the one or more stocks, selling the one or more stocks, and holding the one or more stocks.
4. The system (10) as claimed in claim1, wherein the processing subsystem (20) comprises a portfolio optimization module (110) configured to provide one or more recommendations to the at least one user to optimize a portfolio of the at least one user to increase profit by reducing risk, wherein the one or more recommendations comprises buying the one or more stocks, and selling the one or more stocks.
5. The system (10) as claimed in claim 1, wherein the automated execution module (100) is configured to manage placement of at least one of a buying order and a selling order of the one or more stocks based on trading cost, and liquidity of the one or more stocks.
6. The system (10) as claimed in claim1, wherein the processing subsystem (20) comprises an interactive module (120) configured to render a plurality of information in a user interface of a user device associated with the at least one user, wherein the plurality of information comprises performance of the one or more stocks, trade history, and one or more customization options.
7. The system (10) as claimed in claim 6, wherein the interactive module (120) is configured to generate at least one of a performance report of the one or more stocks, trade summary of the one or more stocks and risk analysis report of the one or more stocks.
8. The system (10) as claimed in claim1, wherein the processing subsystem (20) comprises a training module (130) configured to train the at least one user for performing trading in one or more stock markets.
9. The system (10) as claimed in claim 1, wherein the processing subsystem (20) comprises a regulatory compliance module (140) configured to:
evaluate compliance of the at least one user with one or more financial regulations based on the one or more stocks owned by the at least one user; and
provide one or more recommendations to the at least one user to comply with the one or more financial regulations when the at least one user is noncompliant with the one or more financial regulations upon evaluation.
10. A method (300) to automate trading of one or more stocks in a stock market comprising:
characterized in that:
acquiring, by a data acquisition module, a plurality of information from at least one user, and at least one web resource, wherein the plurality of information comprises one or more stocks owned by the at least one user, price of the one or more corresponding stocks, trading volume of the one or more corresponding stocks, financial news, one or more market conditions, one or more economic indicators, one or more social media sentiments; (310)
preprocessing, by the data acquisition module, the plurality of information to obtain processed information by handling at least one of a missing value and an outlier; (320)
storing, by the data acquisition module, the processed information obtained in the integrated database; (330)
comparing, by a forecasting module, the price of the one or more corresponding stocks, and the trading volume of the one or more corresponding stocks with historical price of the one or more corresponding stocks, and historical trading volume of the one or more corresponding stocks respectively to identify one or more correlations; (340)
forecasting, by the forecasting module, the price of the one or more corresponding stocks and the trading volume of the one or more corresponding stocks for a future instance based on the one or more correlations identified; (350)
assessing, by a risk assessment module, a risk factor associated with each of the one or more corresponding stocks based on at least one of a parameter comprising volatility, market sentiment, and historical performance of the one or more stocks; (360)
generating, by a trading strategy module, at least one trading strategy based on the price of the one or more corresponding stocks forecasted and the risk factor of each of the one or more corresponding stocks assessed; (370) and
executing, by an automated execution module, at least one trading operation based on the at least one trading strategy generated, thereby automating trading of the one or more stocks. (380)

Dated this 09th day of February 2024

Signature

Jinsu Abraham
Patent Agent (IN/PA-3267)
Agent for the Applicant