# Hybrid Neural-Classical Correction for Frozen Time Series Foundation Models: A Comprehensive Ablation Study on High-Frequency Stock Prediction

arXiv: https://arxiv.org/abs/2608.08825 · HTML: https://mlsanity.com/paper/2608.08825/

## Key facts

- No citing papers in the map yet (data through 14 Oct 2026).
- Builds on 12 of its 30 references that are in the map.
- First posted on arXiv 9 Aug 2026.

## Builds on (most cited first, 12 of 12)

- [Exploring the Limits of Transfer Learning with a Unified Text-to-Text Transformer](https://mlsanity.com/paper/1910.10683/) (2019)
- [LoRA: Low-Rank Adaptation of Large Language Models](https://mlsanity.com/paper/2106.09685/) (2021)
- [Layer Normalization](https://mlsanity.com/paper/1607.06450/) (2016)
- [Parameter-Efficient Transfer Learning for NLP](https://mlsanity.com/paper/1902.00751/) (2019)
- [Learning Phrase Representations using RNN Encoder-Decoder for Statistical Machine Translation](https://mlsanity.com/paper/1406.1078/) (2014)
- [Prefix-Tuning: Optimizing Continuous Prompts for Generation](https://mlsanity.com/paper/2101.00190/) (2021)
- [Gaussian Error Linear Units (GELUs)](https://mlsanity.com/paper/1606.08415/) (2016)
- [Informer: Beyond Efficient Transformer for Long Sequence Time-Series Forecasting](https://mlsanity.com/paper/2012.07436/) (2020)
- [Temporal Fusion Transformers for Interpretable Multi-horizon Time Series Forecasting](https://mlsanity.com/paper/1912.09363/) (2019)
- [A decoder-only foundation model for time-series forecasting](https://mlsanity.com/paper/2310.10688/) (2023)
- [Fixup Initialization: Residual Learning Without Normalization](https://mlsanity.com/paper/1901.09321/) (2019)
- [Lag-Llama: Towards Foundation Models for Probabilistic Time Series Forecasting](https://mlsanity.com/paper/2310.08278/) (2023)

## Abstract (arXiv)

Foundation models for time series forecasting demonstrate impressive zero-shot generalization but often underperform on specialized domains such as high-frequency finance. We present a comprehensive study of hybrid neural-classical correction for adapting frozen TimesFM (200M parameters) to stock return prediction during the volatile opening trading hour. We compare two neural correction architectures - AttnCorrect (multi-head self-attention, approximately 471K parameters) and GatedLinear (low-rank bilinear projection with gating, approximately 49K parameters) - each augmented with Random Forest residual learning. Through systematic ablation across 10 major technology stocks (NVDA, MSFT, AAPL, GOOG, GOOGL, AMZN, META, AVGO, TSLA, NFLX) spanning 2 million data points, we reveal critical insights: (1) The hybrid neural-classical approach achieves 0.597 pooled correlation and 6.4x mean per-day correlation improvement over frozen TimesFM; (2) Classical residual learning (Random Forest) provides the largest single-component contribution, matching or exceeding the neural correction component; (3) Simpler neural architectures surprisingly outperform complex ones when classical residual learning is removed; (4) Self-attention provides the largest neural-only contribution. GatedLinear+RF achieves best overall performance with 9x fewer neural parameters than AttnCorrect+RF. We report three complementary correlation metrics - mean per-day, cross-day cumulative, and pooled - to provide a complete picture of predictive quality. Our results provide practical guidance: effective foundation model adaptation requires careful integration of neural and classical components, with classical methods playing a crucial complementary role.