Big Data Science in Finance

Chapter 1Why Big Data?

Introduction

It is the year 2032, and with a wave of your arm, your embedded chip authenticates you to log into your trading portal. For years, Swedes have already been placing chips above their thumb to activate their train tickets or to store their medical records.¹ Privacy, Big Brother, and health concerns aside, the sheer volume of data collected by IDs from everything from nail salons through subway stations is staggering, yet needs to be analyzed in real time to draw competitive inferences about impending market activity.

Do you think this is an unlikely scenario? During World War II, a passive ID technology was developed to leave messages for one's compatriots inside practically any object. The messages were written in tin foil, but were virtually unnoticeable by one's enemy. They could last forever since they didn't contain a battery or any other energy source, and they were undetectable as they did not emit heat or radiation. The messages were only accessible by the specific radio frequency for which they were written – a radio scanner set to a specific wavelength could pick up the message from a few feet away, without holding or touching the object.

Today, the technology behind these messages has made its way into Radio-Frequency Identification devices, RFIDs. They are embedded into pretty much every product you can buy in any store. They are activated at checkout and at the exit, where giant scanners examine you for any unpaid merchandise in ...