DHMoE: Diffusion Generated Hierarchical Multi-Granular Expertise for Stock Prediction

Stock prediction stands as a pivotal research objective within the Fintech. Existing deep learning research revolves around the development and scaling of one individual neural network predictor. However, in the dynamic and noisy landscape of the stock market, reliance solely on a single predictor poses risks of limited adaptability to diverse market conditions and challenges in effectively integrating multi-source information. Besides, top-down teaching and bottom-up hierarchical decision-making paradigms are critical for robust and accurate stock prediction within successful quantitative firms. Nonetheless, there is scarcely any research that integrates this workflow into stock prediction. To this end, we propose Diffusion Generated Hierarchical Mixture-of-Experts (DHMoE) to emulate such workflow in stock prediction. Specifically, DHMoE is crafted as a three-layer tree structure, where each expert functions as a node within the tree and their parameters are generated in a top-down, recursive manner. Recognizing the leading role of the top-level root expert, we harness the robust capabilities of diffusion models for generating and introduce the Diffusion Inverted Transformer (DIT) as the root expert. The DIT is tailored to receive information from various modalities as conditional inputs and allocate parameters to bottom-level experts. These bottom-level experts are responsible for performing predictions specific to their respective input modalities. The prediction results are then synthesized in a bottom-up manner, culminating in the final prediction outcomes. Experiments on three stock trading datasets reveal that DHMoE outperforms state-of-the-art methods in terms of both cumulative and risk-adjusted returns.