A new Forecasting combination system for predicting Volatility

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Main Author: Johanna M. Orozco
Format: Artículo científico
Language:en
Published: Universidad Nacional de Colombia 2013
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author Johanna M. Orozco
author_facet Johanna M. Orozco
contents A new Forecasting combination system for predicting Volatility Johanna M. Orozco Juan D. Velásquez Administración y Contabilidad Volatility forecast combinations Forecast volatility models Forecast combination models have been broadly studied and often used to improve forecast accuracy. this article presents a new non-linear composite model to forecast the volatility of asset returns. our model is composed of a set of GaRCH models fitted to a time series dataset using different loss functions, with the aim of capturing different features of volatility dynamics. individual forecasts are combined by using either the simple arithmetical average method or an artificial neural network. the proposed model is used to forecast the monthly excess returns of s&P500 time series, finding that this new approach is able to forecast volatility with more accuracy than each individual GaRCH model considered. 2013 artículo científico 0121-5051 https://www.redalyc.org/articulo.oa?id=81828692002 en http://www.redalyc.org/revista.oa?id=818 INNOVAR. Revista de Ciencias Administrativas y Sociales application/pdf Universidad Nacional de Colombia INNOVAR. Revista de Ciencias Administrativas y Sociales (Colombia) Num.50 Vol.23
format Artículo científico
id redalyc_81828692002
institution Redalyc
language en
publishDate 2013
publisher Universidad Nacional de Colombia
spellingShingle A new Forecasting combination system for predicting Volatility
Johanna M. Orozco
Administración y Contabilidad
Volatility
forecast combinations
Forecast volatility models
A new Forecasting combination system for predicting Volatility Johanna M. Orozco Juan D. Velásquez Administración y Contabilidad Volatility forecast combinations Forecast volatility models Forecast combination models have been broadly studied and often used to improve forecast accuracy. this article presents a new non-linear composite model to forecast the volatility of asset returns. our model is composed of a set of GaRCH models fitted to a time series dataset using different loss functions, with the aim of capturing different features of volatility dynamics. individual forecasts are combined by using either the simple arithmetical average method or an artificial neural network. the proposed model is used to forecast the monthly excess returns of s&P500 time series, finding that this new approach is able to forecast volatility with more accuracy than each individual GaRCH model considered. 2013 artículo científico 0121-5051 https://www.redalyc.org/articulo.oa?id=81828692002 en http://www.redalyc.org/revista.oa?id=818 INNOVAR. Revista de Ciencias Administrativas y Sociales application/pdf Universidad Nacional de Colombia INNOVAR. Revista de Ciencias Administrativas y Sociales (Colombia) Num.50 Vol.23
title A new Forecasting combination system for predicting Volatility
topic Administración y Contabilidad
Volatility
forecast combinations
Forecast volatility models
url https://www.redalyc.org/articulo.oa?id=81828692002