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Big Data > Everything > Flashcards

Everything Flashcards

1
Q

What is FinTech

A

Fintech, short for financial technology, refers to the integration of technology into offerings by financial services companies to improve their use and delivery to consumers.

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2
Q

Example of fintech

A

Paypal, Lydia,

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3
Q

Name some fintech sub sectors

A

Crypto
Insurance
Payments
Wealth Management
Personal Finance

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4
Q

Benefits of fintech

A
  • Enhanced Accessibility
  • Lower Costs
  • Faster Transactions
  • Improved Security
  • Personalized Services
  • Greater Convenience
  • Automated Services
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5
Q

What’s an API

A

An API (“Application Program Interface”) is an interface by which computers can exchange information and/or instructions with each other, without human intervention. There are many different types of APIs. One of the most common API standard is the REST API, which is use on the world wide web.

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6
Q

Example of an API

A

When you use a weather app on your phone, the app uses an API to request weather data from a remote server. The server sends back the weather information, which the app then displays to you.

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7
Q

Why do we care about APIs?

A

They are fuelling the open banking revolution

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8
Q

What’s open banking

A

Open banking is a system where banks and other financial institutions provide access to their customers’ financial data to third-party service providers, securely and with the customers’ consent. This access is typically achieved through the use of APIs.

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9
Q

What is the GDPR

A

The General Data Protection Regulation (GDPR) is a comprehensive data privacy law in the European Union that sets guidelines for the collection, processing, and storage of personal information of individuals within the EU. It gives individuals greater control over their personal data and requires organizations to protect the privacy and security of this data. GDPR came into effect on May 25, 2018.

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10
Q

Due to regulations, what do you need to run a financial company?

A

A license

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11
Q

Loss aversion

A

It means that for most people, the pain of losing something is stronger than the pleasure of gaining something of the same value.

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12
Q

Human decision biases

A
  • Confirmation Bias: Preferring information that matches beliefs.
  • Availability Heuristic: Valuing easily recalled information.
  • Self-Serving Bias: Attributing success to self, failure to external factors.
  • Anchoring Bias: Over-relying on initial information.
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13
Q

Algorithmic trading PROS

A

Instantaneous decision
Best price trades
Objective criteria, no emotions
No human mistakes
Ability to back test

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14
Q

Algorithmic trading CONS

A

No contextual information taken into account
Back testing (historical data) can be irrelevant
Algorithms can go “mad” (glitches)

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15
Q

Main algo trading strategies

A

Trend following
Arbitrage
Indexfund rebalancing
(and more)

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16
Q

What you need for algo trading strategies

A

Algorithm (duh)
Computing power
Data access (remember APIs?)

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17
Q

What is a blockchain

A

A block chain is a growing list of records, called blocks, that are linked together using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data (generally represented as a merkletree).

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18
Q

What is a hash

A

A hash is a function that converts an input (or ‘message’) into a fixed-size string of characters, which typically appears random. It serves as a digital fingerprint of the data, ensuring data integrity.

19
Q

What does the “timestamp” do in a block

A

The timestamp proves that the transaction data existed when the block was published in order to get into its hash

20
Q

Why is it called a block chain

A

As blocks each contain information about the block previous to it, they form a chain, with each additional block reinforcing the ones before it.

21
Q

What’s special about the data in the blockchain

A

Blockchains are resistant to modification of their data because once recorded, the data in any given block cannot be altered retroactively without altering all subsequent blocks.

22
Q

What’re the main concepts of blockchain

A

Ledger
Coin
Mining
Transaction
Smart contracts

23
Q

Explain “Ledger”

A

LIST OF TRANSACTION RECORDS

24
Q

Explain “Coin”

A

UNIT OF CRYPTO CURRENCY. PARTIAL AMOUNTS CAN BE OWNED

25
Q

Explain “Mining”

A

THE PROCESS OF FINDING AN ORIGINAL SOLUTION TO A HASH RESULT BELOW THE GIVEN HASH CODE IN ORDER TO GET REWARDS

26
Q

Explain “Transaction”

A

TRANSFERING A CRYPTO CURRENCY FROM A HOLDER TO ANOTHER HOLDER

27
Q

Explain “ Smart contracts”

A

ALGORITHMS WHICH ARE EXECUTED AUTOMATICALLY DURING A TRANSACTION

28
Q

How crypto works

A

1- Blockchain participant creates a transaction.
2- The transaction is broadcasted to P2P network consisting of nodes.
3- The network of nodes validates the transaction.
4-Blockchain participants, who allocated processing power to validate transactions, receive a reward in the form of cryptocurrency.
5- A few transactions create a new block.

29
Q

How the blockchain works

A

1- A wants to send money to B
2- The transaction is represented as a block
3- The block broadcasts to every party in the network who later approves transaction
4- Block gets added to the chain
5- transaction complete

30
Q

Blockchain applications

A

There’s a lot and not only for crypto, we talk quite a bit about insurance

31
Q

What is machine learning

A

the study of computer algorithms that can improve automatically through experience and by the use of data. They use the data to make predictions or decisions without being programmed to do so

32
Q

Two main ML tasks

A
  1. Forecasting: what will be the volume of sales of ice-cream depending on the date, temperature, and
    local events ?
  2. Classification: is this transaction fraudulous or legitimate?
33
Q

What is clustering

A
  • Grouping unlabeled examples is called clustering.
  • As the examples are unlabeled, clustering relies on unsupervised machine learning. If the
    examples are labeled, then clustering becomes classification.
34
Q

Linear regression

A

Relationship between Y (dependant) and X (variable) in Y= aX+b

with a =Cov(X,Y)/ Var(X)
b= E(Y) - a*E(Y)

34
Q

Risk of AI

A

Stupidity (Racism)
Biased
Lack of explainability

35
Q

The HIPPO principle

A

HIPPO is an apronym and stands for Highest Paid Person’s Opinion. The effect states that the opinion of the highest paid person is given more consideration in a decision
because it has a higher value per se

36
Q

5 Vs of data

A

Volume: The large amount of data generated and stored.

Velocity: The high speed at which new data is produced and moves through systems.

Value: The usefulness and actionable insights that can be derived from the data.

Veracity: The accuracy and reliability of the data.

Variety: The different types of data, structured and unstructured, from various sources.

37
Q

where is the value creation in data

A

-Google, Amazon, Facebook are integrated models who own their communities
- Pure “pipes” are worth 10x less than communities
- Pure players are niche providers

38
Q

The Gartner data value ladder

A

The Gartner’s analytic value escalator describes the different types of business analytics (descriptive, diagnostic, predictive and prescriptive) as well as their impact on corporate value.

Each type of business analytic has the capacity to respond to a specific question from “what happened” or “why did it happen?” to “what will happen?” or “how can we make it happen?”.

39
Q

Big Data process

A

1- Collect
2- Clean and format
3- Store
4- Transform (scripting)
5- Use (decision, display)

40
Q

SQL meaning

A

SQL (Structured Query Language) databases are relational databases that structure data into predefined tables and relationships. They are ideal for complex queries and are ACID-compliant, ensuring reliable transactions.

41
Q

No SQL

A

NoSQL (Not Only SQL) databases are non-relational or distributed databases that can store and process a wide variety of data types.

42
Q

PSD2 (Payment Service Directive)

A

Piece of legislation designed to force providers of payment services to improve customer authentication processes and to also bring in new regulation around third-party involvement.

PSD2 mandates banks open up API access to fintechs. PSD2 aims to provide for the further development of a better-integrated internal market for electronic payments within the EU. It puts in place a comprehensive framework for payment services, with the goal of making payments within the EU more efficient and secure.

Big Data (1 decks)

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