Data Mining and Financial Data Analysis

Data Mining and Financial Data AnalysisEg, 2. One may like to view the debt and revenue
 change by month, by region and by other factors
Mr. Felix Deepak Minj: [HOD Information Tech.,along with minimum, maximum, total, average,
Shekhawati Group of College, Sikar]and other statistical information. Data ware
 houses, give the facility for comparative analysis
                      and outlier analysis all are play important roles in
 financial data analysis and mining.
Most marketers understand the value of collecting 
financial data, but also realize the challenges ofEg, 3. Loan payment prediction and customer
leveraging this knowledge to create intelligent,credit analysis are critical to the business of the
proactive pathways back to the customer. Databank. There are many factors can strongly
mining - technologies and techniques forinfluence loan payment performance and
recognizing and tracking patterns within data -customer credit rating. Data mining may help
helps businesses sift through layers of seeminglyidentify important factors and eliminate irrelevant
unrelated data for meaningful relationships, whereone.
they can anticipate, rather than simply react to, 
customer needs as well as financial need. In thisFactors related to the risk of loan payments like
accessible introduction, we  provides a businessterm of the loan, debt ratio, payment to income
and technological overview of data mining andratio, credit history and many more. The banks
outlines how, along with sound business processesthan decide whose profile shows relatively low
and complementary technologies, data mining canrisks according to the critical factor analysis.
reinforce and redefine for  financial analysis.We can perform the task faster and create a
 more sophisticated presentation with financial
Objective:analysis software. These products condense
 complex data analyses into easy-to-understand
1. The main objective of mining techniques is tographic presentations. And there’s a bonus:
discuss how customized data mining tools shouldSuch software can vault our practice to a more
be developed for financial data analysis.advanced business consulting level and help we
2. Usage pattern, in terms of the purpose can beattract new clients.
categories as per the need for financial analysis.To help us find a program that best fits our
3.  Develop a tool for financial analysis throughneeds—and our budget—we examined some
data mining techniques.of the leading packages that represent, by
 vendors’ estimates, more than 90% of the
Data mining:market. Although all the packages are marketed
 as financial analysis software, they don’t all
Data mining is the procedure for extracting orperform every function needed for full-spectrum
mining knowledge for the large quantity of data oranalyses. It should allow us to provide a unique
we can say data mining is “knowledge miningservice to clients.
for data” or also we can say KnowledgeThe Products:
Discovery in Database (KDD). Means data miningACCPAC CFO (Comprehensive Financial Optimizer)
is : data collection , database creation, datais designed for small and medium-size enterprises
management, data analysis and understanding.and can help make business-planning decisions by
 modeling the impact of various options. This is
There are some steps in the process ofaccomplished by demonstrating the what-if
knowledge discovery in database, such asoutcomes of small changes. A roll forward feature
1. Data cleaning. (To remove nose and inconsistentprepares budgets or forecast reports in minutes.
data)The program also generates a financial scorecard
2. Data integration. (Where multiple data sourceof key financial information and indicators.
may be combined.)Customized Financial Analysis by BizBench
3. Data selection. (Where data relevant to theprovides financial benchmarking to determine how
analysis task are retrieved from the database.)a company compares to others in its industry by
4. Data transformation. (Where data areusing the Risk Management Association (RMA)
transformed or consolidated into formsdatabase. It also highlights key ratios that need
appropriate for mining by performing summary orimprovement and year-to-year trend analysis. A
aggregation operations, for instance)unique function, Back Calculation, calculates the
5. Data mining. (An essential process whereprofit targets or the appropriate asset base to
intelligent methods are applied in order to extractsupport existing sales and profitability. Its DuPont
data patterns.)Model Analysis demonstrates how each ratio
6. Pattern evaluation. (To identify the trulyaffects return on equity.
interesting patterns representing knowledge basedFinancial Analysis CS reviews and compares a
on some interestingness measures.)client’s financial position with business peers or
7. Knowledge presentation.(Where visualization andindustry standards. It also can compare multiple
knowledge representation techniques are used tolocations of a single business to determine which
present the mined knowledge to the user.)are most profitable. Users who subscribe to the
 RMA option can integrate with Financial Analysis
Data Warehouse:CS, which then lets them provide aggregated
 financial indicators of peers or industry standards,
 A data warehouse is a repository of informationshowing clients how their businesses
collected from multiple sources, stored under acompare.iLumen regularly collects a client’s
unified schema and which usually resides at afinancial information to provide ongoing analysis. It
single site.also provides benchmarking information,
 comparing the client’s financial performance
 with industry peers. The system is Web-based
Text:and can monitor a client’s performance on a
 monthly, quarterly and annual basis. The network
Most of the banks and financial institutions offer acan upload a trial balance file directly from any
wide verity of banking services such as checking,accounting software program and provide charts,
savings, business and individual customergraphs and ratios that demonstrate a
transactions, credit and investment services likecompany’s performance for the period.
mutual funds etc. Some also offer insuranceAnalysis tools are viewed through customized
services and stock investment services.dashboards.
 PlanGuru by New Horizon Technologies can
There are different types of analysis available, butgenerate client-ready integrated balance sheets,
in this case we want to give one analysis knownincome statements and cash-flow statements.
as “Evolution Analysis”.The program includes tools for analyzing data,
 making projections, forecasting and budgeting. It
Data evolution analysis is used for the objectalso supports multiple resulting scenarios. The
whose behavior changes over time. Although thissystem can calculate up to 21 financial ratios as
may include characterization, discrimination,well as the breakeven point. PlanGuru uses a
association, classification, or clustering of timespreadsheet-style interface and wizards that guide
related data, means we can say this evolutionusers through data entry. It can import from
analysis is done through the time series dataExcel, QuickBooks, Peachtree and plain text files.
analysis, sequence or periodicity pattern matchingIt comes in professional and consultant editions.
and similarity based data analysis.An add-on, called the Business Analyzer, calculates
 benchmarks.
Data collect from banking and financial sectors areProfitCents by Sageworks is Web-based, so it
often relatively complete, reliable and high quality,requires no software or updates. It integrates
which gives the facility for analysis and datawith QuickBooks, CCH, Caseware, Creative
mining. Here we discuss few cases such as,Solutions and Best Software applications. It also
 provides a wide variety of businesses analyses
Eg, 1. Suppose we have stock market data offor nonprofits and sole proprietorships. The
the last few years available. And we would like tocompany offers free consulting, training and
invest in shares of best companies. A data miningcustomer support. It’s also available in Spanish.
study of stock exchange data may identify stockProfitSystem fx Profit Driver by CCH Tax and
evolution regularities for overall stocks and for theAccounting provides a wide range of financial
stocks of particular companies. Such regularitiesdiagnostics and analytics. It provides data in
may help predict future trends in stock marketspreadsheet form and can calculate benchmarking
prices, contributing our decision making regardingagainst industry standards. The program can track
stock investments.up to 40 periods.