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ARM Technology
Overview

What is "ARM?"
ARM stands for Adaptive Reasoning Model.  In the Nirvana Club, we have taken ARM several levels above OmniTrader through the use of applied Artificial Intelligence.

The History of ARM2
ARM2 Release 2 was our first version of ARM Technology delivered to Club members, and was based on a Genetic Algorithm process home brewed here at Nirvana.  ARM2 R2 was tunable by the user in terms of desired signal accuracy vs. signal count - a major advancement.

ARM2 Release 3 used a Neural Network to determine a positive or negative score at any bar in a chart.  The network in ARM2 R3 determines a "likely up" or "likely down" state for the chart at any bar. This gave us a new capability, since ARM2 R3 can be applied to ANY trading signal.  ARM2 R3 was released in 2000.**

In 2002 and 2003, we began experimenting with pattern recognition concepts.  ARM2 R4 is based on these findings, which are an application of J.M. Hurst's work on Valid Trend Lines.  The proprietary Nirvana Club VTL-B System is still being used to improve performance in ARM3.

ARM3 - The Next Generation 
The latest version of ARM Technology, which is called ARM3, is literally 'heads and shoulders' above the prior versions.  Using recent advances in Artificial Intelligence and taking advantage of the faster processors available today, we re-built our Neural Network and Genetic Algorithm components from the ground up. 

Members can now build their own Knowledge Bases quickly and easily by simply training our Networks or GAs on their own symbol lists.  Or, they can create their own networks using knowledge they have about Technical Analysis.  And, in 2006, we improved the Genetic Algorithm component further.

The Move to Equity Curves
Before 2007, we had been using a signal measurement technique called Next Pivot Points, to measure Signal Accuracy.  This method told us whether the Entry Signals on a Strategy were improved, but did not yield strategies which could be "mechanically" traded because there were no actual Exits.  

All that changed in 2006.  Our Artificial Intelligence technology is now powerful enough to apply real exits to our strategies - producing Strategies that can be traded mechanically.

Our focus now is on improving performance in the Equity Curves until we have reached our Ultimate Trading Machine goal (see About The Nirvana Club).  However, since we are delivering Strategies to Members that show mechanical profitability over long periods of time, many members are engaging the market with these products now.


** Is ARM2 still being used?  Members still have access to ARM2 as a download from the Nirvana Club web site, but most members have moved on to ARM3 because the ARM3 Strategies are more accurate and use actual Exits.  


ARM2 R3 was developed using a Neural Network, and is capable of signal accuracies of 65% - 70%
 


ARM2 Release 4 uses a new pattern recognition concept called Valid Trend Lines, producing sharp trades at key reversals.  Accuracies produced are typically in the 70% to 75% range.

 


ARM3 is an improved version of our original ARM2 technology.  This chart shows the Neural Network in action on Microsoft.

 


This equity curve reflects the 2 year trading performance of a Genetic Algorithm, called GA-41.  Using the same amount of leverage (margin) the  Knowledge Base beat the S&P 500 Index by 5 to 1.

 
 
 

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