# ResNLS: An Improved Model for Stock Price Forecasting

arXiv: https://arxiv.org/abs/2312.01020 · HTML: https://mlsanity.com/paper/2312.01020/

## Key facts

- No citing papers in the map yet (data through 14 Oct 2026).
- Builds on 11 of its 61 references that are in the map.
- First posted on arXiv 2 Dec 2023.

## Builds on (most cited first, 11 of 11)

- [Attention Is All You Need](https://mlsanity.com/paper/1706.03762/) (2017)
- [BERT: Pre-training of Deep Bidirectional Transformers for Language Understanding](https://mlsanity.com/paper/1810.04805/) (2018)
- [Adam: A Method for Stochastic Optimization](https://mlsanity.com/paper/1412.6980/) (2014)
- [Language Models are Few-Shot Learners](https://mlsanity.com/paper/2005.14165/) (2020)
- [Very Deep Convolutional Networks for Large-Scale Image Recognition](https://mlsanity.com/paper/1409.1556/) (2014)
- [Densely Connected Convolutional Networks](https://mlsanity.com/paper/1608.06993/) (2016)
- [Delving Deep into Rectifiers: Surpassing Human-Level Performance on ImageNet Classification](https://mlsanity.com/paper/1502.01852/) (2015)
- [Visualizing and Understanding Convolutional Networks](https://mlsanity.com/paper/1311.2901/) (2013)
- [Bidirectional Attention Flow for Machine Comprehension](https://mlsanity.com/paper/1611.01603/) (2016)
- [Stacked Attention Networks for Image Question Answering](https://mlsanity.com/paper/1511.02274/) (2015)
- [Scalable, High-Quality Object Detection](https://mlsanity.com/paper/1412.1441/) (2014)

## Abstract (arXiv)

Stock prices forecasting has always been a challenging task. Although many research projects try to address the problem, few of them pay attention to the varying degrees of dependencies between stock prices. In this paper, we introduce a hybrid model that improves the prediction of stock prices by emphasizing the dependencies between adjacent stock prices. The proposed model, ResNLS, is mainly composed of two neural architectures, ResNet and LSTM. ResNet serves as a feature extractor to identify dependencies between stock prices, while LSTM analyzes the initial time series data with the combination of dependencies, which are considered as residuals. Our experiment reveals that when the closing price data for the previous 5 consecutive trading days is used as input, the performance of the model (ResNLS-5) is optimal compared to those with other inputs. Furthermore, ResNLS-5 demonstrates at least a 20% improvement over current state-of-the-art baselines. To verify whether ResNLS-5 can help clients effectively avoid risks and earn profits in the stock market, we construct a quantitative trading framework for back testing. The result shows that the trading strategy based on ResNLS-5 predictions can successfully mitigate losses during declining stock prices and generate profits in periods of rising stock prices.