IRM & Stock Market

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Dec 3, 2013 (3 years and 6 months ago)

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IRM & Stock Market


Kirk Williams


CIS 450


November 4, 2003

On the Menu Today…


Integration of IRM and the US Stock
Market


We are in the transition from a
conventional economy to a knowledge
based economy.

On the Menu Today…


Stock Market


Information Resource Management


Correlation between the Stock Market
and Information Resource Management


Stock Market & Information Resources


Integration of IRM and Stock Market


IRM, Stock Market, and E
-
Commerce

What is the Stock Market?


Marketplace for buying and selling securities


Two types of Stock Markets in US:

1.
Securities Exchanges

a.
NYSE

b.
American Stock Exchange

c.
Midwest Stock Exchange

d.
Pacific Stock Exchange

e.
Philadelphia Stock Exchange

2.
OTC

1.
NASDAQ

What is Information Resource
Management?

Information Resource Management is an
emerging discipline that helps managers
asses and exploit their information assets
for business development. It draws on the
techniques of Information Science
(libraries) and information systems (IT
related)

Building a Knowledge Management Infrastructure by Dr. Guy
-
Alain Amoussou, 2003

Goals of Information Resource
Management


The goal of IRM is to manage knowledge
to support strategic business objectives.


Manage resources such as hardware,
software, telecommunications, and
databases


Reduce inefficiency & paperwork

Importance of Information
Resource Management


In this global, knowledge
-
based economy,
corporate success depends on managing
information, transforming it into explicit
knowledge, and capitalizing off of it


Utilize all components from IT and IS to
support business processes

What is Information Resource
Management?


Apply management techniques to
Information on an organizational level.


Policies, standards, processes for
managing the organization’s data,
information, and knowledge as strategic
business resource.

So…


What is the correlation between the Stock
Market and Information Resource
Management?


Let’s find out!!

Stock Market & Information
Resources


Telecommunication


Data Management


Mobile Data Mining


Software


Hardware

Telecommunication

Traditional stock exchanges are centralized. The
exchange is located in a single physical place,
and all data (both market and trades) flow
through a single system. The centralized system
is responsible for transaction reporting and
exchanging assets. Electronic exchanges, like
the NASDAQ, allow remotely located traders to
connect with the centralized system.

An Internet Multicast System for the Stock Market by N. F. MAXEMCHUK and D. H.
SHUR, 2001.

Telecommunication:


Multiple Data Sequences


Dedicated Access Lines & Private
Networks


High Bandwidth Requirement


Network Engineering with primary goal of
preventing data loss

Telecommunication Issues:


Spoofing


Denial of service


Authorized service for transmission and
reception


Encryption


Security

Data Management


Stock Markets and brokers require real
-
time data access and is the ultimate in
data management.


Brokers deal with the public over public
and private networks


Public portfolio access can be interactive,
customizable, and dynamic

IRM Data Management Research


Stock market / data management research
is improving IRM processes

IRM Data Management Research


Clustering of data sets with similar attributes
using Euclidean mathematics.

Clustering is perhaps the most frequently used
data mining algorithm, being useful in it’s own
right as an exploratory technique, and also as a
subroutine in more complex data mining
algorithms such as rule discovery, indexing,
summarization, anomaly detection, and
classification.

Data streams II: Clustering of streaming time series is meaningless

by Jessica Lin,
Eamonn Keogh, Wagner Truppel,2003.

Mobile Data Mining

The emergence of powerful mobile devices with
reasonable computing and storage capacity is
ushering an era of advanced data and
computationally intensive mobile applications.
Monitoring and mining time
-
critical data streams
in a ubiquitous fashion is one such possibility.
Financial data monitoring, process control,
regulation compliance, and security applications
are some possible domains where such
ubiquitous [data] mining is very appealing.


Contributed articles on online, interactive, and anytime data mining: MobiMine:
monitoring the stock market from a PDA by
Hillol Kargupta, Byung
-
Hoon Park, Sweta
Pittie, Lei Liu, Deepali Kushraj, Kakali Sarkar
, 2002


Mobile Data Mining


Stock Market IRM is not a traditional client
-
server model


Efficiently represent and communicate the data
mining objects over wireless networks


Changing Human Computer Interaction for
mobile devices


Minimal power/CPU consumption for compact
applications


Again, Security.

Mobile Data Mining

The graphical techniques for designing interfaces
on desktop systems do not apply well to
handheld devices. Screen resources are limited;
often screens are black and white to reduce cost
and power consumption. Memory and
processing power are much reduced from
desktop systems.

Overcoming the Lack of Screen Space on Mobile Computers

by Stephen Brewster,
2002


Mobile Data Integrity

Fair exchange protocols establish fairness and
ensure that both participants can engage in the
exchange without the risk of suffering a
disadvantage (e.g., losing their money without
receiving anything for it). In general, fair
exchange protocols require the continuous
availability of an external
trusted third party
(TTP), a dedicated site which is trusted by both
participants. Implementations of TTPs for fair
exchange have been proposed to be based on
carefully secured Internet hosts in order to
establish trust.

Supporting fair exchange in mobile environments

by Holger Vogt, Felix C. Gärtner,
Henning Pagnia, 2003.

Software


Stock Market IRM are web
-
based systems


What is the language widely used to
implement this?


XML ensures data structure in data
streams

Hardware


Data Warehouses


Data quality and data integrity are issues


Stock markets have Centralized data
warehouses serving hundreds of
thousands of other servers

Distributed systems


Massive amounts of Data Archiving across
multiple systems


Data integrity is an issue in any distributed
system


Source Data Analysis


Database Structure doesn’t always match contents


Thorough data analysis

Epice

The point is, ladies and gentleman, is that
greed

--

for lack of a better word
--

is good. Greed is
right. Greed works. Greed clarifies, cuts through
and captures the essence of the evolutionary
spirit. Greed, in all of its forms
--

greed for life,
for money, for love, knowledge
--

has marked
the upward surge of mankind. And Greed
--

you
mark my words
--

will not only save Teldar
Paper but that other malfunctioning corporation
called the USA.

Wall Street,1985

Integration of IRM and Stock
Market


Stock Exchanges and IRM


Stock Market Oversight and IRM


Effects of IRM on stock market investing

Stock Exchanges and IRM


The Stock Market’s relationship with IRM
is one that entails finance, economics, AI,
psychology, and mathematics

Stock Market Oversight and IRM


Securities and Exchange Commission

The primary mission of the U.S. Securities and Exchange
Commission (SEC) is to protect investors and maintain
the integrity of the securities markets. As more and more
first
-
time investors turn to the markets to help secure
their futures, pay for homes, and send children to
college, these goals are more compelling than ever.

http://www.sec.gov/about/whatwedo.shtml, 2003

Edgar


Electronic Data Gathering, Analysis, and
Retrieval system


Historical 10
-
K and 10
-
Q reports


Millions of document transactions per
month

http://www.sec.gov/edgar/aboutedgar.htm, 2003

Effect of IRM on Stock Market


Overconfident investors overreact and
under react


This causes fluctuations in the stock
market

Effects of IT and IRM on the
Stock Market

The ubiquity of online trading services allows individuals to
trade without the need to consult a human broker. Also,
financial intermediaries and portals have emerged
offering market information and trading tips. This
information rich environment enhances the cumulative
and the individual knowledge of traders, thereby making
the market more informed and rational. However, the
availability of online trading avenues also introduces a
high number of uninformed traders into the systems,
thus introducing irrationality into the market.

Is more information better? The effect of traders' irrational behavior on an artificial stock
market by
Wei T. Yue, Alok R. Chaturvedi, Shailendra Mehta, 2000

Benefits of IRM in publicly traded
corporations


Productivity paradox


Companies that institute IRM increase their
value and their stock price

Firms that are high IT users are also more likely to
adopt work practices that involve a cluster of
organizational characteristics, including greater
use of teams and broader decision authority.

Intangible Assets: How the interaction of Computers and Organizational Structure Affects Stock
Market Valuations, Erik Brynjolfsson, Lorin M. Hitt, Shinkyu Yang, 1998

Corporate IRM Implementation


Wal
-
Mart


Amazon


FedEx


Outsourcing IRM experts

IRM, Stock Market, and E
-
Commerce


Rise and Fall of the Dot Com


E
-
Investing


Automated Consulting


Stock Market Simulation

E
-
Commerce


Did eTrade cause the burst the eBubble?


DotCom: venture capitalists put up cash
and that helps a company go to a bank to
get backed to go public. Banks and
venture capitalists hype the stock, public
increasingly market
-
driven so buys stocks
in these worthless companies

E
-
Investing


Implementation of IRM / stock market
front
-
end is web based.


Traditional brokers like Price Waterhouse
have been forced into e
-
commerce to
survive

Day Trading on the Web


Day Trading on the Web


Dynamic, Real
-
time stock quotes and
transactions


Use your Palm compatible device, WAP
enabled cell phone or Pocket PC to place
orders for stocks, get real
-
time stock
quotes and account balances, and check
order status and transaction history.

ETrade

www.etrade.com

Scottrade


Automated Consulting


Forecasting


Maximize returns, minimize risk


Predictive Modeling: statistical techniques,
neural networks, genetic algorithms

Automated Consulting


Stock market systems are difficult to model


Piecewise Normalization of stock market indices


Indexing time sequences with Fourier Transform


Designing algorithms for stock market indices
based on historical data is NP
-
hard


Discrepancy between the efficient market
hypothesis and empirical evidence

Stock Market Simulation


IRM Research


Stock Market Game Program
(
www.smgww.org
)


Virtual Stock Exchange
(game.marketwatch.com)

E
-
Information


So if IRM is so good on the web, how did
places like Enron defraud their workers
from 401K benefits?


That’s accounting. This is IRM.

IRM & Stock Market


Today we saw how the Stock Market and
IRM coexist and support one another.

Bibliography

Amoussou, Guy
-
Alain
Building a Knowledge Management Infrastructure
. September 4, 2003

Brewster, Stephen.
Overcoming the Lack of Screen Space on Mobile Computers
.


Personal and Ubiquitous Computing
,

Volume 6 Issue 3: January 2002

Brynjolfsson, Erik. Hitt, Lorin M. Yang, Shinkyu.
Intangible Assets: How the interaction of Computers
and Organizational Structure Affects Stock Market Valuations.
Proceedings of the international
conference on Information systems
. December 1998


http://www.sec.gov/about/whatwedo.shtml
. 2003


http
:
//www
.
sec
.
gov/edgar/aboutedgar
.
htm
.

2003

Kargupta, Hillol. Park, Byung
-
Hoon. Pittie, Sweta. Liu, Lei. Kushraj, Deepali. Kakali Sarkar.
Contributed articles on online, interactive, and anytime data mining: MobiMine: monitoring the
stock market from a PDA
.
ACM SIGKDD Explorations Newsletter
.

Volume 3 Issue 2: January
2002


Lin, Jessica. Keogh, Eamonn. Truppel, Wagner.
Data streams II: Clustering of streaming time series
is meaningless
.
Proceedings of the 8th ACM SIGMOD workshop on Research issues in data
mining and knowledge discovery:
June 2003.


Maxemchuk, N. F. Shur, D. H.

An Internet Multicast System for the Stock Market
.
ACM Transactions
on Computer Systems (TOCS)
. Volume 19 Issue 3: August 2001


Vogt, Holger. G
ä
rtner Felix C. Pagnia Henning.
Supporting fair exchange in mobile environments
.
Mobile Networks and Applications.

Volume 8 Issue 2: April 2003.


Yue, Wei T. Chaturvedi,Alok R. Mehta , Shailendra.
Is more information better? The effect of traders'
irrational behavior on an artificial stock market
.
Proceedings of the twenty first international
conference on Information systems.
December 2000.