Basic preprocessing

We all start with one of the simplest transformations.

Often we are not interested in an absolute value but a relative value that’s usually the case when working

with stock prices.

If you open Google and type Apple’s stock price what you’ll get is Apple’s stock price but with red

or green numbers the relative change in Apple’s stock price.

This is an example of pre-processing that is so common we don’t consider it as such relative metrics

are especially useful when we have a time series data like stock prices Forex exchange rates and so

on still in the world of finance we can further transform these relative changes into logarithms many

statistical and mathematical methods take advantage of logarithms as they facilitate faster computation

in machine learning log transformations are not as common but can increase the speed of learning OK.

Great.

So this is one type of pre-processing we wanted to give as an example.

Let’s continue to our next lesson where we will deal with pre-processing transformations that are more

typical for the world of machine learning.

Stick around.

And thanks for watching.