FINANCEGPT LABS

Large Quantitative Models: A Generative AI Approach to

Overcome Predictive AI and Large Language Model
Challenges in Stock Price Prediction and Financial Forecasting

White Paper
FinanceGPT Labs © 2023. All Rights Reserved.

Contents
Abstract ........................................................................................................................... 2
Introduction ..................................................................................................................... 3
Problem Statement............................................................................................................
Solution .............................................................................................................................
Architecture and Techniques .............................................................................................
Training and Application ....................................................................................................
Advantages of Large Quantitative Models (LQMs) ............................................................
Applications of Large Quantitative Models (LQMs) ...........................................................
Use Cases.........................................................................................................................
Artificial General Intelligence .............................................................................................
Conclusion ........................................................................................................................

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FinanceGPT Labs © 2023. All Rights Reserved.

Abstract
This whitepaper presents FinanceGPT, a novel Variational AutoEncoder Generative
Adversarial Network (VAE-GAN) framework designed to address the limitations of Large
Language Models (LLMs) and traditional predictive AI in financial forecasting and stock
price prediction. The paper introduces Large Quantitative Models (LQMs), a new class of
pre-trained generative AI models, tailored for quantitative finance applications. LQMs
capture the intricacies of quantitative relationships and extract insights from complex
financial data, addressing the challenges of data volatility, limited historical data, non-
linear relationships, and overfitting. The paper explores the architecture, training,
application, and advantages of LQMs, and their potential to improve AI-powered financial
analysis and decision-making. It also discusses the role of FinanceGPT within the broader
context of Artificial General Intelligence (AGI), highlighting its potential contributions to the
development of AGI in finance and investments.

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FinanceGPT Labs © 2023. All Rights Reserved.

Introduction
The advent of artificial intelligence (AI), particularly machine learning, has brought about
a transformative shift in financial analysis, including stock price prediction and financial
forecasting. However, these models continue to grapple with challenges that compromise
their accuracy and reliability. These challenges, which include data volatility, limited
historical data, non-linear relationships, and overfitting issues, have necessitated the
development of more robust and reliable models.

Figure 1: The challenges of traditional predictive AI models in financial forecasting.

This paper introduces FinanceGPT, a generative AI framework that leverages the power
of Variational AutoEncoder Generative Adversarial Network (VAE-GAN) to offer
innovative solutions to these persistent challenges.
FinanceGPT is a framework that is specifically designed to address the inherent
limitations of traditional predictive AI models and large language models (LLMs) in
financial forecasting. It does so by harnessing the unique capabilities of generative AI and
introducing the concept of Large Quantitative Models (LQMs).
LQMs are a class of pre-trained generative AI models that are specifically engineered for
quantitative finance applications. They are designed to capture the nuances of
quantitative relationships and distil insights from complex financial data, thereby
addressing the limitations of LLMs.
This paper provides a comprehensive overview of the architecture, training, application,
and advantages of LQMs, as well as their potential applications and use cases in the field
of quantitative finance.

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The paper concludes with a discussion on the role of FinanceGPT in the broader context
of Artificial General Intelligence (AGI). AGI refers to highly autonomous systems that
outperform humans at most economically valuable work. While AGI remains a long-term
goal, the development of models like FinanceGPT represents a significant step towards
this direction. By demonstrating advanced capabilities in a specific domain like finance,
FinanceGPT contributes to the ongoing research and development efforts aimed at
achieving AGI.

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Go to https://financegptlabs.com/whitepaper/ for the rest of the paper.

Keywords: FinanceGPT, Large Language Model, Predictive AI, Stock Price Prediction,
Financial Forecasting, Generative AI, VAE-GAN, Data Volatility, Non-Linear
Relationships, Overfitting, Frontier Markets, Artificial General Intelligence.
Additional references:
• Goodfellow, I. J., Pouget-Abadie, J., Mirza, M., Bengio, Y., & Courville, A. C. (2014).
Generative adversarial nets. In Advances in neural information processing systems
(pp. 2672-2680).
• Kingma, D. P., & Welling, M. (2013). Auto-encoding variational Bayes. arXiv preprint
arXiv:1312.6114.
• Gherghina, S. (2023). Quantitative Methods in Finance. Springer.
• Ozbayoglu, A., Gudelek, M., Sezer, O. (2020). Deep Learning for Financial
Applications: A Survey. Expert Systems with Applications.
• Russell, S., & Norvig, P. (2022). Artificial Intelligence: A Modern Approach. Pearson.
• Bostrom, N. (2014). Superintelligence: Paths, Dangers, Strategies. Oxford University
Press.