The Knowledge Balance Sheet: Understanding the "Why" Behind the Market
What separates a truly intelligent system from a simple bot? The ability to understand context. While most trading systems only see the "what" (the price), the AISHE engine is built on a proprietary model designed to understand the "why": the Knowledge Balance Sheet.
This framework, co-developed by our founder Sedat Özcelik, is an advanced management methodology for identifying and quantifying a system's intangible assets. To make this concept intuitive, let's use a physical analogy: imagine we are not just looking at a price chart, but at the entire, living ecosystem of a global financial market.
1. The Human Factor (Human Capital & Assets)
This is the most critical and dynamic factor. It represents the knowledge, intentions, strategies, and emotions of all human market participants, from individual retail traders to institutional fund managers. It is the "why" behind their decisions to buy or sell.
AISHE's Analysis: AISHE does not rely on simple chart patterns to guess this factor. Instead, its neural network is trained to detect the *footprints* of these human decisions in the market data. It analyzes the velocity of price movements, the asymmetry of order flow, and specific volatility signatures to infer the dominant psychological state of the market—whether it is driven by rational, long-term strategy or by short-term, collective fear and greed.
2. The Structural Factor (Structural Capital & Assets)
This represents the codified, systematic knowledge and infrastructure of the market itself. It is the "logic" that exists independently of any single human's decision. This includes:
- The underlying logic of automated trading systems and high-frequency algorithms.
- The established rules of exchanges and financial instruments.
- The predictable impact of scheduled macroeconomic data releases (e.g., interest rate decisions, inflation reports).
- The accumulated "memory" of the market, such as long-term price levels that have psychological significance.
AISHE's Analysis: AISHE identifies the influence of this factor by recognizing when market behavior adheres to predictable, systematic patterns, distinguishing it from the more chaotic, human-driven movements.
3. The Relational Factor (Relational Capital & Assets)
No market exists in a vacuum. The Relational Factor represents the network of trust, influence, and correlation between different markets, assets, and even regulatory bodies. It is the "connective tissue" of the global financial ecosystem.
AISHE's Analysis: AISHE continuously monitors a vast web of inter-market relationships. It analyzes how a change in the bond market impacts currencies, how oil price shocks affect stock indices, or how a statement from a central bank influences market-wide sentiment. It detects when these established relationships strengthen, weaken, or break down, which are often powerful leading indicators for future market movements.
The Synthesis: An Intelligent Forecast
AISHE's power comes from its ability to synthesize these three distinct factors in real time. It provides a quantified forecast based on which factor is currently dominant, and assigns this forecast a **"Half-Life"**—an acknowledgment that the validity of any market state analysis decays over time.
By understanding the market through this holistic, multi-faceted lens, AISHE moves beyond simplistic technical analysis into the realm of true, contextual market intelligence.
Questions about the Knowledge Balance Sheet Model
Q1: Is the "Knowledge Balance Sheet" a recognized scientific concept?
Yes. The concept of the "Wissensbilanz," or Knowledge Balance Sheet, is a well-established management and economic theory. It is used by organizations to measure and manage their intangible assets. Our founder, Sedat Özcelik, was a co-developer of the advanced "Wissensbilanz 2.0" model. AISHE represents the first known application of this powerful framework to the dynamic, real-time analysis of financial markets.
You can read more about the general concept on Wikipedia: "Wissensbilanz" (German) and Knowledge Balance Sheet (English).
Q2: So AISHE does not use technical chart analysis?
That is correct in the traditional sense. AISHE does not rely on conventional technical indicators like moving averages or RSI. It analyzes the raw price and volume data, but it uses this data to infer the state of the underlying, more fundamental factors (Human, Structural, Relational). While some of its inputs (like historical price levels) might seem similar to technical analysis, the way it processes and contextualizes this information within its multi-factor model is fundamentally different and far more sophisticated.
