• Proceedings of the Korea Inteligent Information System Society Conference
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• 1999.10a
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• pp.347-354
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• 1999

The credit rating represents an assessment of the relative level of risk associated with the timely payments required by the debt obligation. In this paper, we present a new approach to credit rating of customers based on the rough set theory. The concept of a rough set appeared to be an effective tool for the analysis of customer information systems representing knowledge gained by experience. The customer information system describes a set of customers by a set of multi-valued attributes, called condition attributes. The customers are classified into groups of risk subject to an expert's opinion, called decision attribute. A natural problem of knowledge analysis consists then in discovering relationships, in terms of decision rules, between description of customers by condition attributes and particular decisions. The rough set approach enables one to discover minimal subsets of condition attributes ensuring an acceptable quality of classification of the customers analyzed and to derive decision rules from the customer information system which can be used to support decisions about rating new customers. Using the rough set approach one analyses only facts hidden in data, it does not need any additional information about data and does not correct inconsistencies manifested in data; instead, rules produced are categorized into certain and possible. A real problem of the evaluation of the evaluation of credit rating by a department store is studied using the rough set approach.

• Proceedings of the Korea Inteligent Information System Society Conference
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• 1999.10a
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• pp.337-346
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• 1999

In this paper, we propose the rough set approach to extract trading rules able to discriminate between bullish and bearish markets in stock market. The rough set approach is very valuable to extract trading rules. First, it does not make any assumption about the distribution of the data. Second, it not only handles noise well, but also eliminates irrelevant factors. In addition, the rough set approach appropriate for detecting stock market timing because this approach does not generate the signal for trade when the pattern of market is uncertain. The experimental results are encouraging and prove the usefulness of the rough set approach for stock market analysis with respect to profitability.

• Proceedings of the Korean Institute of Intelligent Systems Conference
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• 1997.11a
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• pp.248-251
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• 1997

In this paper, We propose the concept of approximate Classification in the field of two group discriminan analysis. In our approach, an attribute space is divided into three subspaces. Two subspaces are for given two group and one subspace is for a boundary area between the two groups. We propose Approximate Pattern Classification with Rough set. We also propose learning procedures of neural networks for approximate classification. We propose two weighting methods which lead to possibility analysis and necessity analysis. We illustrate the proposed methods by numerical examples.

• Journal of Digital Convergence
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• v.12 no.6
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• pp.223-229
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• 2014

In an attempt to retrieve useful information for an efficient decision in the large knowledge system, it is generally necessary and important for a refined feature selection. Rough set has difficulty in generating optimal reducts and classifying boundary objects. In this paper, we propose quick reduction algorithm generating optimal features by rough entropy analysis for condition and decision attributes to improve these restrictions. We define a new conditional information entropy for efficient feature extraction and describe procedure of feature selection to classify the significance of features. Through the simulation of 5 datasets from UCI storage, we compare our feature selection approach based on rough set theory with the other selection theories. As the result, our modeling method is more efficient than the previous theories in classification accuracy for feature selection.

• Journal of Digital Convergence
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• v.11 no.11
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• pp.343-349
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• 2013

Rough set theory comes to derive optimal rules through the effective selection of features from the redundancy of lots of information in data mining using the concept of equivalence relation and approximation space in rough set. The reduction of attributes is one of the most important parts in its applications of rough set. This paper purports to define a information-theoretic measure for determining the most important attribute within the association of attributes using rough entropy. The proposed method generates the effective reduct set and formulates the core of the attribute set through the elimination of the redundant attributes. Subsequently, the control rules are generated with a subset of feature which retain the accuracy of the original features through the reduction.

• Journal of the Korean Institute of Intelligent Systems
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• v.11 no.5
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• pp.441-447
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• 2001

In general, Rough Set theory is used for classification, inference, and decision analysis of incomplete data by using approximation space concepts in information system. Information system can include quantitative attribute values which have interval characteristics, or incomplete data such as multiple or unknown(missing) data. These incomplete data cause tole inconsistency in information system and decrease the classification ability in system using Rough Sets. In this paper, we present various types of incomplete data which may occur in information system and propose INcomplete information Processing System(INiPS) which converts incomplete information system into complete information system in using Rough Sets.

• Proceedings of the Korean Institute of Intelligent Systems Conference
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• 1996.10a
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• pp.337-339
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• 1996

In this paper, we construct rough relational database model using approximation concepts of rough set. Also, we analyze the relation between objects, attributes and attribute values and, propose the method that can generate flexible retrieval results.

• Journal of Korean Society of Industrial and Systems Engineering
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• v.36 no.4
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• pp.123-129
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• 2013

The aim of this study is to design an intelligent pattern-based real-time trading system (PRTS) using rough set analysis of technical indicators, dynamic time warping (DTW), and genetic algorithm in stock futures market. Rough set is well known as a data-mining tool for extracting trading rules from huge data sets such as real-time data sets, and a technical indicator is used for the construction of the data sets. To measure similarity of patterns, DTW is used over a given period. Through an empirical study, we identify the ideal performances that were profitable in various market conditions.

• Journal of Intelligence and Information Systems
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• v.16 no.3
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• pp.77-97
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• 2010

Market timing is an investment strategy which is used for obtaining excessive return from financial market. In general, detection of market timing means determining when to buy and sell to get excess return from trading. In many market timing systems, trading rules have been used as an engine to generate signals for trade. On the other hand, some researchers proposed the rough set analysis as a proper tool for market timing because it does not generate a signal for trade when the pattern of the market is uncertain by using the control function. The data for the rough set analysis should be discretized of numeric value because the rough set only accepts categorical data for analysis. Discretization searches for proper "cuts" for numeric data that determine intervals. All values that lie within each interval are transformed into same value. In general, there are four methods for data discretization in rough set analysis including equal frequency scaling, expert's knowledge-based discretization, minimum entropy scaling, and na$\ddot{i}$ve and Boolean reasoning-based discretization. Equal frequency scaling fixes a number of intervals and examines the histogram of each variable, then determines cuts so that approximately the same number of samples fall into each of the intervals. Expert's knowledge-based discretization determines cuts according to knowledge of domain experts through literature review or interview with experts. Minimum entropy scaling implements the algorithm based on recursively partitioning the value set of each variable so that a local measure of entropy is optimized. Na$\ddot{i}$ve and Booleanreasoning-based discretization searches categorical values by using Na$\ddot{i}$ve scaling the data, then finds the optimized dicretization thresholds through Boolean reasoning. Although the rough set analysis is promising for market timing, there is little research on the impact of the various data discretization methods on performance from trading using the rough set analysis. In this study, we compare stock market timing models using rough set analysis with various data discretization methods. The research data used in this study are the KOSPI 200 from May 1996 to October 1998. KOSPI 200 is the underlying index of the KOSPI 200 futures which is the first derivative instrument in the Korean stock market. The KOSPI 200 is a market value weighted index which consists of 200 stocks selected by criteria on liquidity and their status in corresponding industry including manufacturing, construction, communication, electricity and gas, distribution and services, and financing. The total number of samples is 660 trading days. In addition, this study uses popular technical indicators as independent variables. The experimental results show that the most profitable method for the training sample is the na$\ddot{i}$ve and Boolean reasoning but the expert's knowledge-based discretization is the most profitable method for the validation sample. In addition, the expert's knowledge-based discretization produced robust performance for both of training and validation sample. We also compared rough set analysis and decision tree. This study experimented C4.5 for the comparison purpose. The results show that rough set analysis with expert's knowledge-based discretization produced more profitable rules than C4.5.

• Management & Information Systems Review
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• v.1
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• pp.401-412
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• 1997

Traditionally, classification of remote sensed image data is one of the important works for image data analysis procedure. So, many researchers have been devoted their endeavor to increasing accuracy of analysis, also, many classification algorithms have been proposed. In this paper, we propose new bands selection method for multispectral bands of remote sensed image data that use rough set theory. Using indiscernibility relations in rough sets, we show that can select the efficient bands of multispectral image data, automatically.