Weak Relation Enforcement for Kinematic-Informed Long-Term Stock Prediction with Artificial Neural Networks
Artificial neural networks (ANNs) suffer from spurious predictions in long-horizon stock forecasting due to high data volatility, out-of-distribution (OOD) test samples, and outliers. Method: This paper proposes a kinematics-inspired weak-relation-constrained neural network. It jointly optimizes both predictions and their first-order differences (“velocity”) in the loss function to explicitly model dynamic temporal evolution. A weak-relation enforcement mechanism mitigates structural distortion induced by autoregressive normalization while preserving original neighborhood topology. Additionally, a velocity-aware composite loss and normalization-sensitive activation functions are introduced, ensuring compatibility with diverse RNN architectures. Contribution/Results: Evaluated on 15 years of Dow Jones Industrial Average data, the method significantly improves long-term forecasting stability and statistical significance. It demonstrates superior robustness—particularly under OOD conditions and during periods of high market volatility—while maintaining architectural flexibility and interpretability through physics-informed constraints.