jgrusewski 9bf67e731d research: AI4Finance debunked + PEAD dies OOS (efficient-market wall confirmed again) ...

3 omnisearch researchers + clean PEAD test answer 'why does AI4Finance find what we cant':
they dont. FinRL flagship (Sharpe 1.30) = single-split, slippage-free, no-deflation, bull-market,
survivorship, hand-coded crash rule; their own people (Gort/Liu AAAI'23) published the overfitting
rebuttal; zero live track record. ML-trading decays 73%+ backtest->live, faster for complexity.
PEAD tested properly (real Nasdaq surprises x DBEQ, leak-free, 23bp cost, OOS): full-sample looked
good (20d +0.29% t=2.9) but pure in-sample bull-beta -> OOS NEGATIVE every horizon; surprise-size
signature fails. Strongest classic anomaly dies OOS. Untested real pulse left: prediction markets
(uncorrelated). Tooling: fetch_earnings.py, pead_real.py, dbeq_symbology resolved (17605 tickers).

Co-Authored-By: Claude Opus 4.8 (1M context) <noreply@anthropic.com>

2026-06-07 17:15:22 +02:00

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