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Forecasting Exchange-Rates via Local Approximation Methods and Neural Networks

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Author Info
ANDREOU , ANDREAS S.
ZOMBANAKIS, GEORGE A.
GEORGOPOULOS, E. F.
LIKOTHANASSIS, S. D.

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Abstract

There has been an increased number of papers in the literature in recent years, applying several methods and techniques for exchange - rate prediction. This paper focuses on the Greek drachma using daily observations of the drachma rates against four major currencies, namely the U.S. Dollar (USD), the Deutsche Mark (DM), the French Franc (FF) and the British Pound (GBP) for a period of 11 years, aiming at forecasting their short-term course by applying local approximation methods based on both chaotic analysis and neural networks.

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File URL: http://mpra.ub.uni-muenchen.de/17764/
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Publisher Info
Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 17764.

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Date of creation: Dec 1998
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Publication status: Published in EUROPEAN RESEARCH STUDIES 4.1(1998): pp. 5-33
Handle: RePEc:pra:mprapa:17764

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Related research
Keywords: Key Words: Exchange Rates; Forecasting; Neural Networks;

Find related papers by JEL classification:
C45 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Neural Networks and Related Topics

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  1. Kim, Benjamin J. C. & Mo, Soowon, 1995. "Cointegration and the long-run forecast of exchange rates," Economics Letters, Elsevier, vol. 48(3-4), pages 353-359, June. [Downloadable!] (restricted)
  2. Pesaran, M Hashem & Potter, Simon M, 1992. "Nonlinear Dynamics and Econometrics: An Introduction," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 7(S), pages S1-7, Suppl. De. [Downloadable!] (restricted)
  3. West, Kenneth D. & Cho, Dongchul, 1995. "The predictive ability of several models of exchange rate volatility," Journal of Econometrics, Elsevier, vol. 69(2), pages 367-391, October. [Downloadable!] (restricted)
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  4. Booth, G. Geoffrey & Kaen, Fred R. & Koveos, Peter E., 1982. "R/S analysis of foreign exchange rates under two international monetary regimes," Journal of Monetary Economics, Elsevier, vol. 10(3), pages 407-415. [Downloadable!] (restricted)
  5. Mark P. Taylor, 1995. "The Economics of Exchange Rates," Journal of Economic Literature, American Economic Association, vol. 33(1), pages 13-47, March. [Downloadable!] (restricted)
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  6. Brissimis, Sophocles N. & Leventakis, John A., 1989. "The effectiveness of devaluation: A general equilibrium assessment with reference to Greece," Journal of Policy Modeling, Elsevier, vol. 11(2), pages 247-271. [Downloadable!] (restricted)
  7. Marsh, Ian W. & Power, David M., 1996. "A note on the performance of foreign exchange forecasters in a portfolio framework," Journal of Banking & Finance, Elsevier, vol. 20(3), pages 605-613, April. [Downloadable!] (restricted)
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