http://dx.doi.org/10.31703/gmsr.2025(X-I).06
10.31703/gmsr.2025(X-I).06
Published : Mar 2025
Artificial Intelligence-based Deep Learning Model Optimizing Financial Predictions: Empirical Evidence from Top six Markets
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<p style="text-align: justify;">Navigating the complexities of the foreign exchange market remains a significant challenge for investors and risk managers worldwide. This study addresses this challenge by developing a Deep Learning-based Multilayer Perceptron (DL MLP) model to classify daily multi-currency exchange rate returns (USD, EUR, GBP, CHF, JPY, CNY) from 2010 to 2024. The framework categorizes market movements into three distinct states: appreciation (good returns), depreciation (bad returns), and stability (no returns), transforming these categorical outcomes into a numerical format suitable for neural network processing via one-hot encoding. Powered by a backpropagation algorithm, the model demonstrates exceptional predictive capability, achieving a 91% classification accuracy and near-perfect AUC ROC scores, thereby identifying optimal safe-haven currencies with high reliability. The empirical findings offer a powerful data-driven tool for forex investors seeking to refine their strategic asset allocation and for global risk managers aiming to enhance their hedging strategies against currency volatility.</p>
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Multicurrency Exchange Rate Returns, Deep Learning, Optimal Prediction Performance
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(1) Rabia Akram
College of Management, Shenzhen University, Guangdong, 518060, PR China.
Cite this article
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APA : Akram, R. (2025). Artificial Intelligence-based Deep Learning Model Optimizing Financial Predictions: Empirical Evidence from Top six Markets. Global Management Sciences Review, X(I), 62-83. https://doi.org/10.31703/gmsr.2025(X-I).06
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CHICAGO : Akram, Rabia. 2025. "Artificial Intelligence-based Deep Learning Model Optimizing Financial Predictions: Empirical Evidence from Top six Markets." Global Management Sciences Review, X (I): 62-83 doi: 10.31703/gmsr.2025(X-I).06
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HARVARD : AKRAM, R. 2025. Artificial Intelligence-based Deep Learning Model Optimizing Financial Predictions: Empirical Evidence from Top six Markets. Global Management Sciences Review, X, 62-83.
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MHRA : Akram, Rabia. 2025. "Artificial Intelligence-based Deep Learning Model Optimizing Financial Predictions: Empirical Evidence from Top six Markets." Global Management Sciences Review, X: 62-83
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MLA : Akram, Rabia. "Artificial Intelligence-based Deep Learning Model Optimizing Financial Predictions: Empirical Evidence from Top six Markets." Global Management Sciences Review, X.I (2025): 62-83 Print.
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OXFORD : Akram, Rabia (2025), "Artificial Intelligence-based Deep Learning Model Optimizing Financial Predictions: Empirical Evidence from Top six Markets", Global Management Sciences Review, X (I), 62-83
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TURABIAN : Akram, Rabia. "Artificial Intelligence-based Deep Learning Model Optimizing Financial Predictions: Empirical Evidence from Top six Markets." Global Management Sciences Review X, no. I (2025): 62-83. https://doi.org/10.31703/gmsr.2025(X-I).06