Machine Learning in Portfolio Decisions

Machine learning is having a major impact in the development of many fields, including finance, where its domain of application and efficiency impact may be considered limitless. Modern techniques of reinforcement learning have led practitioners and academics to conjecture on the scope of a potential artificial intelligence revolution in portfolio management. In this chapter, we summarize the main strands of machine learning currently used in portfolio decisions and discuss both the current limitations of the algorithms and the dominant conjectures on the future avenues of its extensions.