Economic and financial prediction using rough sets model

A state-of-the-art review of the literature related to economic and financial prediction using rough sets model is presented, with special emphasis on the business failure prediction, database marketing and financial investment. These three applications require the accurate prediction of the future states based on the identification of patterns in the historical data. In addition, the historical data are in the format of a multi-attribute information table. All these conditions suit the rough sets model, an effective tool for multi-attribute classification problems. The different rough sets models and issues concerning the implementation of rough sets model – indicator selection, discretization and validation test, are also discussed in this paper. This paper will demonstrate that rough sets model is applicable to a wide range of practical problems pertaining to economic and financial prediction. In addition, the results show that the rough sets model is a promising alternative to the conventional methods for economic and financial prediction.     

Business failure prediction using the UTADIS multicriteria analysis method

Business failure prediction is one of the most essential problems in the field of financial management. The research on developing quantitative business failure prediction models has been focused on building discriminant models to distinguish among failed and non-failed firms. Several researchers in this field have proposed multivariate statistical discrimination techniques. This paper explores the applicability of multicriteria analysis to predict business failure. Four preference disaggregation methods, namely the UTADIS method and three of its variants, are compared to three well-known multivariate statistical and econometric techniques, namely discriminant analysis, logit and probit analyses. A basic (learning) sample and a holdout (testing) sample are used to perform the comparison. Through this comparison, the relative performance of all the aforementioned methods is investigated regarding their discriminating and predicting ability.     

Online streaming feature selection using rough sets

Feature Selection (FS) is an important pre-processing step in data mining and classification tasks. The aim of FS is to select a small subset of most important and discriminative features. All the traditional feature selection methods assume that the entire input feature set is available from the beginning. However, online streaming features (OSF) are an integral part of many real-world applications. In OSF, the number of training examples is fixed while the number of features grows with time as new features stream in. A critical challenge for online streaming feature selection (OSFS) is the unavailability of the entire feature set before learning starts. Several efforts have been made to address the OSFS problem, however they all need some prior knowledge about the entire feature space to select informative features. In this paper, the OSFS problem is considered from the rough sets (RS) perspective and a new OSFS algorithm, called OS-NRRSAR-SA, is proposed. The main motivation for this consideration is that RS-based data mining does not require any domain knowledge other than the given dataset. The proposed algorithm uses the classical significance analysis concepts in RS theory to control the unknown feature space in OSFS problems. This algorithm is evaluated extensively on several high-dimensional datasets in terms of compactness, classification accuracy, run-time, and robustness against noises. Experimental results demonstrate that the algorithm achieves better results than existing OSFS algorithms, in every way.     

Axiomatic systems for rough sets and fuzzy rough sets

Rough set theory is an important tool for approximate reasoning about data. Axiomatic systems of rough sets are significant for using rough set theory in logical reasoning systems. In this paper, outer product method are used in rough set study for the first time. By this approach, we propose a unified lower approximation axiomatic system for Pawlak’s rough sets and fuzzy rough sets. As the dual of axiomatic systems for lower approximation, a unified upper approximation axiomatic characterization of rough sets and fuzzy rough sets without any restriction on the cardinality of universe is also given. These rough set axiomatic systems will help to understand the structural feature of various approximate operators.     

Rule learning: Ordinal prediction based on rough sets and soft-computing

This work promotes a novel point of view in rough set applications: rough sets rule learning for ordinal prediction is based on rough graphical representation of the rules. Our approach tackles two barriers of rule learning. Unlike in typical rule learning, we construct ordinal prediction with a mathematical approach, rough sets, rather than purely rule quality measures. This construction results in few but significant rules. Moreover, the rules are given in terms of ordinal predictions rather than as unique values. This study also focuses on advancing rough sets theory in favor of soft-computing. Both theoretical and a designed architecture are presented. The features of our proposed approach are illustrated using an experiment in survival analysis. A case study has been performed on melanoma data. The results demonstrate that this innovative system provides an improvement of rule learning both in computing performance for finding the rules and the usefulness of the derived rules.     

Triangular fuzzy decision-theoretic rough sets

Based on decision-theoretic rough sets (DTRS), we augment the existing model by introducing into the granular values. More specifically, we generalize a concept of the precise value of loss function to triangular fuzzy decision-theoretic rough sets (TFDTRS). Firstly, ranking the expected loss with triangular fuzzy number is analyzed. In light of Bayesian decision procedure, we calculate three thresholds and derive decision rules. The relationship between the values of the thresholds and the risk attitude index of decision maker presented in the ranking function is analyzed. With the aid of multiple attribute group decision making, we design an algorithm to determine the values of losses used in TFDTRS. It is achieved with the use of particle swarm optimization. Our study provides a solution in the aspect of determining the value of loss function of DTRS and extends its range of applications. Finally, an example is presented to elaborate on the performance of the TFDTRS model.     

Topology vs generalized rough sets

This paper investigates the relationship between topology and generalized rough sets induced by binary relations. Some known results regarding the relation based rough sets are reviewed, and some new results are given. Particularly, the relationship between different topologies corresponding to the same rough set model is examined. These generalized rough sets are induced by inverse serial relations, reflexive relations and pre-order relations, respectively. We point that inverse serial relations are weakest relations which can induce topological spaces, and that different relation based generalized rough set models will induce different topological spaces. We proved that two known topologies corresponding to reflexive relation based rough set model given recently are different, and gave a condition under which the both are the same topology.     

Axiomatics for fuzzy rough sets

A fuzzy T-rough set consists of a set X and a T-similarity relation R on X, where T is a lower semi-continuous triangular norm. We generalize the Farinas-Prade definition for the upper approximation operator of a fuzzy T-rough set (X, R); given originally for the special case T = Min, to the case of arbitrary T. We propose a new definition for the lower approximation operator of (X,R). Our definition satisfies the two important identities and , as well as a number of other interesting properties. We provide axiomatics to fully characterize those upper and lower approximations.     

Fuzzy sets and join spaces associated with rough sets

Let μ _X be the rough membership function. One compares μ _A with μ_A∪B and μ_A∪B, by the associated hyperoperations. One finds a condition such that a functionμ ε [0, 1] ^H may be a rough membership function.     

Covering rough sets based on neighborhoods: An approach without using neighborhoods

Rough set theory, a mathematical tool to deal with inexact or uncertain knowledge in information systems, has originally described the indiscernibility of elements by equivalence relations. Covering rough sets are a natural extension of classical rough sets by relaxing the partitions arising from equivalence relations to coverings. Recently, some topological concepts such as neighborhood have been applied to covering rough sets. In this paper, we further investigate the covering rough sets based on neighborhoods by approximation operations. We show that the upper approximation based on neighborhoods can be defined equivalently without using neighborhoods. To analyze the coverings themselves, we introduce unary and composition operations on coverings. A notion of homomorphism is provided to relate two covering approximation spaces. We also examine the properties of approximations preserved by the operations and homomorphisms, respectively.     

NMGRS: Neighborhood-based multigranulation rough sets

Recently, a multigranulation rough set (MGRS) has become a new direction in rough set theory, which is based on multiple binary relations on the universe. However, it is worth noticing that the original MGRS can not be used to discover knowledge from information systems with various domains of attributes. In order to extend the theory of MGRS, the objective of this study is to develop a so-called neighborhood-based multigranulation rough set (NMGRS) in the framework of multigranulation rough sets. Furthermore, by using two different approximating strategies, i.e., seeking common reserving difference and seeking common rejecting difference, we first present optimistic and pessimistic 1-type neighborhood-based multigranulation rough sets and optimistic and pessimistic 2-type neighborhood-based multigranulation rough sets, respectively. Through analyzing several important properties of neighborhood-based multigranulation rough sets, we find that the new rough sets degenerate to the original MGRS when the size of neighborhood equals zero. To obtain covering reducts under neighborhood-based multigranulation rough sets, we then propose a new definition of covering reduct to describe the smallest attribute subset that preserves the consistency of the neighborhood decision system, which can be calculated by Chen’s discernibility matrix approach. These results show that the proposed NMGRS largely extends the theory and application of classical MGRS in the context of multiple granulations.     

Matroidal approaches to rough sets via closure operators

This paper studies rough sets from the operator-oriented view by matroidal approaches. We firstly investigate some kinds of closure operators and conclude that the Pawlak upper approximation operator is just a topological and matroidal closure operator. Then we characterize the Pawlak upper approximation operator in terms of the closure operator in Pawlak matroids, which are first defined in this paper, and are generalized to fundamental matroids when partitions are generalized to coverings. A new covering-based rough set model is then proposed based on fundamental matroids and properties of this model are studied. Lastly, we refer to the abstract approximation space, whose original definition is modified to get a one-to-one correspondence between closure systems (operators) and concrete models of abstract approximation spaces. We finally examine the relations of four kinds of abstract approximation spaces, which correspond exactly to the relations of closure systems.     

On some types of neighborhood-related covering rough sets

Covering rough sets are natural extensions of the classical rough sets by relaxing the partitions to coverings. Recently, the concept of neighborhood has been applied to define different types of covering rough sets. In this paper, by introducing a new notion of complementary neighborhood, we consider some types of neighborhood-related covering rough sets, two of which are firstly defined. We first show some basic properties of the complementary neighborhood. We then explore the relationships between the considered covering rough sets and investigate the properties of them. It is interesting that the set of all the lower and upper approximations belonging to the considered types of covering rough sets, equipped with the binary relation of inclusion ?, constructs a lattice. Finally, we also discuss the topological importance of the complementary neighborhood and investigate the topological properties of the lower and upper approximation operators.     

Fuzzy rough sets and multiple-premise gradual decision rules

We propose a new fuzzy rough set approach which, differently from most known fuzzy set extensions of rough set theory, does not use any fuzzy logical connectives (t-norm, t-conorm, fuzzy implication). As there is no rationale for a particular choice of these connectives, avoiding this choice permits to reduce the part of arbitrary in the fuzzy rough approximation. Another advantage of the new approach is that it is based on the ordinal properties of fuzzy membership degrees only. The concepts of fuzzy lower and upper approximations are thus proposed, creating a base for induction of fuzzy decision rules having syntax and semantics of gradual rules. The proposed approach to rule induction is also interesting from the viewpoint of philosophy supporting data mining and knowledge discovery, because it is concordant with the method of concomitant variations by John Stuart Mill. The decision rules are induced from lower and upper approximations defined for positive and negative relationships between credibility degrees of multiple premises, on one hand, and conclusion, on the other hand.     

The granular accuracy of approximation for the rough sets

自Pawlak提出粗糙集概念以来,人们一直对粗糙集的近似精度很有兴趣,出现了不少有关近似精度的文献.本文提出了粗糙集的粒度近似精度,讨论了粒度近似精度的性质,并与Pawlak近似精度和基于等价关系图过剩熵的近似精度进行了比较.比较发现粒度近似精度更具合理性.     

Reduction about approximation spaces of covering generalized rough sets

The introduction of covering generalized rough sets has made a substantial contribution to the traditional theory of rough sets. The notion of attribute reduction can be regarded as one of the strongest and most significant results in rough sets. However, the efforts made on attribute reduction of covering generalized rough sets are far from sufficient. In this work, covering reduction is examined and discussed. We initially construct a new reduction theory by redefining the approximation spaces and the reducts of covering generalized rough sets. This theory is applicable to all types of covering generalized rough sets, and generalizes some existing reduction theories. Moreover, the currently insufficient reducts of covering generalized rough sets are improved by the new reduction. We then investigate in detail the procedures to get reducts of a covering. The reduction of a covering also provides a technique for data reduction in data mining.