The purpose of this chapter is to compare the performance of a deep learning modeling technique to predict market performance compared to conventional prediction modeling techniques. A secondary purpose of this chapter is to describe the degree to which financial risk tolerance can be used to predict future stock market performance. Specifically, the models used in this chapter were developed to test whether aggregate investor financial risk tolerance is of value in establishing risk and return market expectations. Findings from this chapter's examples also provide insights into whether financial risk tolerance is more appropriately conceptualized as a predictor of market returns or as an outcome of returns.
