pwc-archive/papers-with-abstracts huggingface dataset:
Statistical Validation of Contagion Centrality in Financial Networks
Authors: Agathe Sadeghi, Zachary Feinstein
Date: 2024-04-22 00:00:00

In this paper, we introduce an impact centrality measure to evaluate shock propagation on financial networks capturing a notion of contagion and systemic risk contributions, permitting comparisons of these risks over time. In addition, we provide a statistical validation method when the network is estimated from data, as is done in practice. This statistical test allows us to reliably assess the computed centrality values. We validate our methodology on simulated data and conduct empirical case studies using financial data. We find that our proposed centrality measure increases significantly during times of financial distress and is able to provide insights into the (market implied) risk-levels of different firms and sectors.
Optimal Design of Automated Market Makers on Decentralized Exchanges
Authors: Xue Dong He, Chen Yang, Yutian Zhou
Date: 2024-04-20 00:00:00

Automated market makers are a popular mechanism used on decentralized exchange, through which users trade assets with each other directly and automatically through a liquidity pool and a fixed pricing function. The liquidity provider contributes to the liquidity pool by supplying assets to the pool, and in return, they earn trading fees from investors who trade in the pool. We propose a model of optimal liquidity provision in which a risk-averse liquidity provider decides the amount of wealth she would invest in the decentralized market to provide liquidity in a two-asset pool, trade in a centralized market, and consume in multiple periods. We derive the liquidity provider's optimal strategy and the optimal design of the automated market maker that maximizes the liquidity provider's utility. We find that the optimal unit trading fee increases in the volatility of the fundamental exchange rate of the two assets. We also find that the optimal pricing function is chosen to make the asset allocation in the liquidity pool efficient for the liquidity provider.
On a fundamental statistical edge principle
Authors: Tommaso Gastaldi
Date: 2024-04-22 00:00:00

This paper establishes that conditioning the probability of execution of new orders on the self-generated historical trading information (HTI) of a trading strategy is a necessary condition for a statistical trading edge. It is shown, in particular, that, given any trading strategy S that does not use its own HTI, it is always possible to construct a new strategy S* that yields a systematically increasing improvement over S in terms of profit and loss (PnL) by using the self-generated HTI. This holds true under rather general conditions that are frequently met in practice, and it is proven through a decision mechanism specifically designed to formally prove this idea. Simulations and real-world trading evidence are included for validation and illustration, respectively.
An Asymmetric Capital Asset Pricing Model
Authors: Abdulnasser Hatemi-J
Date: 2024-04-22 00:00:00
Tasks: model, Position

Providing a measure of market risk is an important issue for investors and financial institutions. However, the existing models for this purpose are per definition symmetric. The current paper introduces an asymmetric capital asset pricing model for measurement of the market risk. It explicitly accounts for the fact that falling prices determine the risk for a long position in the risky asset and the rising prices govern the risk for a short position. Thus, a position dependent market risk measure that is provided accords better with reality. The empirical application reveals that Apple stock is more volatile than the market only for the short seller. Surprisingly, the investor that has a long position in this stock is facing a lower volatility than the market. This property is not captured by the standard asset pricing model, which has important implications for the expected returns and hedging designs.
Dispensing with optimal control: a new approach for the pricing and management of share buyback contracts
Authors: Bastien Baldacci, Philippe Bergault, Olivier Guéant
Date: 2024-04-21 00:00:00
Tasks: Management

This paper introduces a novel methodology for the pricing and management of share buyback contracts, overcoming the limitations of traditional optimal control methods, which frequently encounter difficulties with high-dimensional state spaces and the intricacies of selecting appropriate risk penalty or risk aversion parameter. Our methodology applies optimized heuristic strategies to maximize the contract's value. The computation of this value utilizes classical methods typically used for pricing path-dependent options. Additionally, our approach naturally leads to the formulation of a $\Delta$-hedging strategy and disentangles therefore the repurchase strategy from the hedging of the payoff.
Extremal cases of distortion risk measures with partial information
Authors: Mengshuo Zhao, Narayanaswamy Balakrishnan, Chuancun Yin, Hui Shao
Date: 2024-04-21 00:00:00

This paper considers the best- and worst-case of a general class of distortion risk measures when only partial information regarding the underlying distributions is available. Specifically, explicit sharp lower and upper bounds for a general class of distortion risk measures are derived based on the first two moments along with some shape information, such as symmetry/unimodality property of the underlying distributions. The proposed approach provides a unified framework for extremal problems of distortion risk measures.
FlowMind: Automatic Workflow Generation with LLMs
Authors: Zhen Zeng, William Watson, Nicole Cho, Saba Rahimi, Shayleen Reynolds, Tucker Balch, Manuela Veloso
Date: 2024-03-17 00:00:00
Tasks: Benchmarking, Question Answering

The rapidly evolving field of Robotic Process Automation (RPA) has made significant strides in automating repetitive processes, yet its effectiveness diminishes in scenarios requiring spontaneous or unpredictable tasks demanded by users. This paper introduces a novel approach, FlowMind, leveraging the capabilities of Large Language Models (LLMs) such as Generative Pretrained Transformer (GPT), to address this limitation and create an automatic workflow generation system. In FlowMind, we propose a generic prompt recipe for a lecture that helps ground LLM reasoning with reliable Application Programming Interfaces (APIs). With this, FlowMind not only mitigates the common issue of hallucinations in LLMs, but also eliminates direct interaction between LLMs and proprietary data or code, thus ensuring the integrity and confidentiality of information - a cornerstone in financial services. FlowMind further simplifies user interaction by presenting high-level descriptions of auto-generated workflows, enabling users to inspect and provide feedback effectively. We also introduce NCEN-QA, a new dataset in finance for benchmarking question-answering tasks from N-CEN reports on funds. We used NCEN-QA to evaluate the performance of workflows generated by FlowMind against baseline and ablation variants of FlowMind. We demonstrate the success of FlowMind, the importance of each component in the proposed lecture recipe, and the effectiveness of user interaction and feedback in FlowMind.
Intellecta Cognitiva: A Comprehensive Dataset for Advancing Academic Knowledge and Machine Reasoning
Authors: Ajmal PS, Ditto PS, Jithin VG
Date: 2024-04-13 00:00:00

Intellecta dataset emerges as an innovative synthetic dataset, engineered to enhance the cognitive processing capabilities of contemporary language models. With a composition of 11.53 billion tokens, integrating 8.01 billion tokens of synthetic data with 3.52 billion tokens of rich textbook data, Intellecta is crafted to foster advanced reasoning and comprehensive educational narrative generation. Leveraging the Mixtral-8x7B-Instruct-v0.1 model, the dataset facilitates the generation of complex thought processes and detailed, textbook-style explanations, thus enabling language models to engage in both critical thinking and profound educational discourse. This hybrid dataset stands as a testament to the potential of synthetic data in pushing the boundaries of AI, offering a repository that is not only vast and varied but also refined to align with ethical standards and intellectual rigor.
Leveraging Large Language Model as Simulated Patients for Clinical Education
Authors: Yanzeng Li, Cheng Zeng, Jialun Zhong, Ruoyu Zhang, Minhao Zhang, Lei Zou
Date: 2024-04-13 00:00:00
Tasks: Diagnostic, Language Modeling, Language Modelling, Large Language Model

Simulated Patients (SPs) play a crucial role in clinical medical education by providing realistic scenarios for student practice. However, the high cost of training and hiring qualified SPs, along with the heavy workload and potential risks they face in consistently portraying actual patients, limit students' access to this type of clinical training. Consequently, the integration of computer program-based simulated patients has emerged as a valuable educational tool in recent years. With the rapid development of Large Language Models (LLMs), their exceptional capabilities in conversational artificial intelligence and role-playing have been demonstrated, making them a feasible option for implementing Virtual Simulated Patient (VSP). In this paper, we present an integrated model-agnostic framework called CureFun that harnesses the potential of LLMs in clinical medical education. This framework facilitates natural conversations between students and simulated patients, evaluates their dialogue, and provides suggestions to enhance students' clinical inquiry skills. Through comprehensive evaluations, our approach demonstrates more authentic and professional SP-scenario dialogue flows compared to other LLM-based chatbots, thus proving its proficiency in simulating patients. Additionally, leveraging CureFun's evaluation ability, we assess several medical LLMs and discuss the possibilities and limitations of using LLMs as virtual doctors from the perspective of their diagnostic abilities.
Towards Efficient Resume Understanding: A Multi-Granularity Multi-Modal Pre-Training Approach
Authors: Feihu Jiang, Chuan Qin, Jingshuai Zhang, Kaichun Yao, Xi Chen, Dazhong Shen, Chen Zhu, HengShu Zhu, Hui Xiong
Date: 2024-04-13 00:00:00
Tasks: document understanding

In the contemporary era of widespread online recruitment, resume understanding has been widely acknowledged as a fundamental and crucial task, which aims to extract structured information from resume documents automatically. Compared to the traditional rule-based approaches, the utilization of recently proposed pre-trained document understanding models can greatly enhance the effectiveness of resume understanding. The present approaches have, however, disregarded the hierarchical relations within the structured information presented in resumes, and have difficulty parsing resumes in an efficient manner. To this end, in this paper, we propose a novel model, namely ERU, to achieve efficient resume understanding. Specifically, we first introduce a layout-aware multi-modal fusion transformer for encoding the segments in the resume with integrated textual, visual, and layout information. Then, we design three self-supervised tasks to pre-train this module via a large number of unlabeled resumes. Next, we fine-tune the model with a multi-granularity sequence labeling task to extract structured information from resumes. Finally, extensive experiments on a real-world dataset clearly demonstrate the effectiveness of ERU.
Evidence from counterfactual tasks supports emergent analogical reasoning in large language models
Authors: Taylor Webb, Keith J. Holyoak, Hongjing Lu
Date: 2024-04-14 00:00:00
Tasks: counterfactual

We recently reported evidence that large language models are capable of solving a wide range of text-based analogy problems in a zero-shot manner, indicating the presence of an emergent capacity for analogical reasoning. Two recent commentaries have challenged these results, citing evidence from so-called `counterfactual' tasks in which the standard sequence of the alphabet is arbitrarily permuted so as to decrease similarity with materials that may have been present in the language model's training data. Here, we reply to these critiques, clarifying some misunderstandings about the test materials used in our original work, and presenting evidence that language models are also capable of generalizing to these new counterfactual task variants.
Modeling Emotions and Ethics with Large Language Models
Authors: Edward Y. Chang
Date: 2024-04-15 00:00:00
Tasks: Decision Making, Ethics, Image Generation, Self-Supervised Learning

This paper explores the integration of human-like emotions and ethical considerations into Large Language Models (LLMs). We first model eight fundamental human emotions, presented as opposing pairs, and employ collaborative LLMs to reinterpret and express these emotions across a spectrum of intensity. Our focus extends to embedding a latent ethical dimension within LLMs, guided by a novel self-supervised learning algorithm with human feedback (SSHF). This approach enables LLMs to perform self-evaluations and adjustments concerning ethical guidelines, enhancing their capability to generate content that is not only emotionally resonant but also ethically aligned. The methodologies and case studies presented herein illustrate the potential of LLMs to transcend mere text and image generation, venturing into the realms of empathetic interaction and principled decision-making, thereby setting a new precedent in the development of emotionally aware and ethically conscious AI systems.
Towards Compositionally Generalizable Semantic Parsing in Large Language Models: A Survey
Authors: Amogh Mannekote
Date: 2024-04-15 00:00:00
Tasks: Information Retrieval, Retrieval, Semantic Parsing, SQL Parsing, Text to SQL, Text-To-SQL

Compositional generalization is the ability of a model to generalize to complex, previously unseen types of combinations of entities from just having seen the primitives. This type of generalization is particularly relevant to the semantic parsing community for applications such as task-oriented dialogue, text-to-SQL parsing, and information retrieval, as they can harbor infinite complexity. Despite the success of large language models (LLMs) in a wide range of NLP tasks, unlocking perfect compositional generalization still remains one of the few last unsolved frontiers. The past few years has seen a surge of interest in works that explore the limitations of, methods to improve, and evaluation metrics for compositional generalization capabilities of LLMs for semantic parsing tasks. In this work, we present a literature survey geared at synthesizing recent advances in analysis, methods, and evaluation schemes to offer a starting point for both practitioners and researchers in this area.
LLM Evaluators Recognize and Favor Their Own Generations
Authors: Arjun Panickssery, Samuel R. Bowman, Shi Feng
Date: 2024-04-15 00:00:00
Tasks: Benchmarking

Self-evaluation using large language models (LLMs) has proven valuable not only in benchmarking but also methods like reward modeling, constitutional AI, and self-refinement. But new biases are introduced due to the same LLM acting as both the evaluator and the evaluatee. One such bias is self-preference, where an LLM evaluator scores its own outputs higher than others' while human annotators consider them of equal quality. But do LLMs actually recognize their own outputs when they give those texts higher scores, or is it just a coincidence? In this paper, we investigate if self-recognition capability contributes to self-preference. We discover that, out of the box, LLMs such as GPT-4 and Llama 2 have non-trivial accuracy at distinguishing themselves from other LLMs and humans. By fine-tuning LLMs, we discover a linear correlation between self-recognition capability and the strength of self-preference bias; using controlled experiments, we show that the causal explanation resists straightforward confounders. We discuss how self-recognition can interfere with unbiased evaluations and AI safety more generally.
SuRe: Summarizing Retrievals using Answer Candidates for Open-domain QA of LLMs
Authors: Jaehyung Kim, Jaehyun Nam, Sangwoo Mo, Jongjin Park, Sang-Woo Lee, Minjoon Seo, Jung-Woo Ha, Jinwoo Shin
Date: 2024-04-17 00:00:00
Tasks: Question Answering, Retrieval

Large language models (LLMs) have made significant advancements in various natural language processing tasks, including question answering (QA) tasks. While incorporating new information with the retrieval of relevant passages is a promising way to improve QA with LLMs, the existing methods often require additional fine-tuning which becomes infeasible with recent LLMs. Augmenting retrieved passages via prompting has the potential to address this limitation, but this direction has been limitedly explored. To this end, we design a simple yet effective framework to enhance open-domain QA (ODQA) with LLMs, based on the summarized retrieval (SuRe). SuRe helps LLMs predict more accurate answers for a given question, which are well-supported by the summarized retrieval that could be viewed as an explicit rationale extracted from the retrieved passages. Specifically, SuRe first constructs summaries of the retrieved passages for each of the multiple answer candidates. Then, SuRe confirms the most plausible answer from the candidate set by evaluating the validity and ranking of the generated summaries. Experimental results on diverse ODQA benchmarks demonstrate the superiority of SuRe, with improvements of up to 4.6% in exact match (EM) and 4.0% in F1 score over standard prompting approaches. SuRe also can be integrated with a broad range of retrieval methods and LLMs. Finally, the generated summaries from SuRe show additional advantages to measure the importance of retrieved passages and serve as more preferred rationales by models and humans.
Efficient Contextual LLM Cascades through Budget-Constrained Policy Learning
Authors: Xuechen Zhang, Zijian Huang, Ege Onur Taga, Carlee Joe-Wong, Samet Oymak, Jiasi Chen
Date: 2024-04-17 00:00:00
Tasks: GSM8K, Navigate

Recent successes in natural language processing have led to the proliferation of large language models (LLMs) by multiple providers. Each LLM offering has different inference accuracy, monetary cost, and latency, and their accuracy further depends on the exact wording of the question (i.e., the specific prompt). At the same time, users often have a limit on monetary budget and latency to answer all their questions, and they do not know which LLMs to choose for each question to meet their accuracy and long term budget requirements. To navigate this rich design space, we propose TREACLE ($\underline{T}$hrifty $\underline{Rea}$soning via $\underline{C}$ontext-Aware $\underline{L}$LM and Prompt S$\underline{e}$lection), a reinforcement learning policy that jointly selects the model and prompting scheme while respecting the user's monetary cost and latency constraints. TREACLE uses the problem context, including question text embeddings (reflecting the type or difficulty of a query) and the response history (reflecting the consistency of previous responses) to make smart decisions. Our evaluations on standard reasoning datasets (GSM8K, CSQA, and LLC) with various LLMs and prompts show that TREACLE enables cost savings of up to 85% compared to baselines, while maintaining high accuracy. Importantly, it provides the user with the ability to gracefully trade off accuracy for cost.
Equivariant Neural Simulators for Stochastic Spatiotemporal Dynamics
Authors: Koen Minartz, Yoeri Poels, Simon Koop, Vlado Menkovski
Date: 2023-05-23 00:00:00
Proceeding: NeurIPS 2023 11
Tasks: Uncertainty Quantification

Neural networks are emerging as a tool for scalable data-driven simulation of high-dimensional dynamical systems, especially in settings where numerical methods are infeasible or computationally expensive. Notably, it has been shown that incorporating domain symmetries in deterministic neural simulators can substantially improve their accuracy, sample efficiency, and parameter efficiency. However, to incorporate symmetries in probabilistic neural simulators that can simulate stochastic phenomena, we need a model that produces equivariant distributions over trajectories, rather than equivariant function approximations. In this paper, we propose Equivariant Probabilistic Neural Simulation (EPNS), a framework for autoregressive probabilistic modeling of equivariant distributions over system evolutions. We use EPNS to design models for a stochastic n-body system and stochastic cellular dynamics. Our results show that EPNS considerably outperforms existing neural network-based methods for probabilistic simulation. More specifically, we demonstrate that incorporating equivariance in EPNS improves simulation quality, data efficiency, rollout stability, and uncertainty quantification. We conclude that EPNS is a promising method for efficient and effective data-driven probabilistic simulation in a diverse range of domains.
AVeriTeC: A Dataset for Real-world Claim Verification with Evidence from the Web
Authors: Michael Schlichtkrull, Zhijiang Guo, Andreas Vlachos
Date: 2023-05-22 00:00:00
Proceeding: NeurIPS 2023 11
Tasks: Claim Verification, Fact Checking, Question Answering

Existing datasets for automated fact-checking have substantial limitations, such as relying on artificial claims, lacking annotations for evidence and intermediate reasoning, or including evidence published after the claim. In this paper we introduce AVeriTeC, a new dataset of 4,568 real-world claims covering fact-checks by 50 different organizations. Each claim is annotated with question-answer pairs supported by evidence available online, as well as textual justifications explaining how the evidence combines to produce a verdict. Through a multi-round annotation process, we avoid common pitfalls including context dependence, evidence insufficiency, and temporal leakage, and reach a substantial inter-annotator agreement of $\kappa=0.619$ on verdicts. We develop a baseline as well as an evaluation scheme for verifying claims through several question-answering steps against the open web.
Collective Classification of Textual Documents by Guided Self-Organization in T-Cell Cross-Regulation Dynamics
Authors: Alaa Abi-Haidar, Luis M. Rocha
Date: 2011-02-04 00:00:00
Tasks: Articles, Binary Classification, Classification, Document Classification, text-classification, Text Classification

We present and study an agent-based model of T-Cell cross-regulation in the adaptive immune system, which we apply to binary classification. Our method expands an existing analytical model of T-cell cross-regulation (Carneiro et al. in Immunol Rev 216(1):48-68, 2007) that was used to study the self-organizing dynamics of a single population of T-Cells in interaction with an idealized antigen presenting cell capable of presenting a single antigen. With agent-based modeling we are able to study the self-organizing dynamics of multiple populations of distinct T-cells which interact via antigen presenting cells that present hundreds of distinct antigens. Moreover, we show that such self-organizing dynamics can be guided to produce an effective binary classification of antigens, which is competitive with existing machine learning methods when applied to biomedical text classification. More specifically, here we test our model on a dataset of publicly available full-text biomedical articles provided by the BioCreative challenge (Krallinger in The biocreative ii. 5 challenge overview, p 19, 2009). We study the robustness of our model's parameter configurations, and show that it leads to encouraging results comparable to state-of-the-art classifiers. Our results help us understand both T-cell cross-regulation as a general principle of guided self-organization, as well as its applicability to document classification. Therefore, we show that our bio-inspired algorithm is a promising novel method for biomedical article classification and for binary document classification in general.