Elimination of Financial Bubbles Exposure in the Risk-Yield Discriminant Optimisation -KYDON by Nikos Loukeris :: SSRN

The novel risK-Yield Discriminant OptimisatioN-KYDON can optimise the portfolio selection in a volatile market, eliminating the exposure to extreme events: bubbles and busts. Implementing novel methods such as i) Chaos Dynamics, ii) Behavioral Welfare, iii) Optimal AI classifiers, KYDON supports the optimal investment policy. It diagnoses the possibility of bubbles, preparing its burst under expectations of long growth, and reduces the impact of systemic risk. KYDON performs as a dragon-slayer eliminating the loss of investors.