We study how researchers can apply machine learning (ML) methods in finance. We first establish that the two major categories of ML (supervised and unsupervised learning) address fundamentally different problems than traditional econometric approaches. Then, we review the current state of...

Artificial intelligence and machine learning have increasing influence on the financial sector, but also on economy as a whole. The impact of artificial intelligence and machine learning on banking risk management has become particularly interesting after the global financial crisis. The...