Financial Informatics –II:
Ontology and Semantic Web and Finance
Khurshid Ahmad,
Professor of Computer Science,
Department of Computer Science
Trinity College,
Dublin-2, IRELAND
March 2014.
https://www.cs.tcd.ie/Khurshid.Ahmad/Teaching.html
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Financial Informatics:
Semantic Web and Ontology
SOURCE: Firat, Aykut; Madnick, Stuart; and Grosof, Benjamin, "Knowledge Integration to Overcome
Ontological Heterogeneity: Challenges from Financial Information Systems" (2002). ICIS 2002
Proceedings. Paper 17. http://aisel.aisnet.org/icis2002/17
2
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Financial Informatics:
Semantic Web and Ontology
‘Constructing correct
definitions of pizzas
from a menu and for a
“vegetarian pizza” so
that the correct pizzas
are classified as
“vegetarian” turns out to
be a surprisingly
challenging exercise’ for
creating an ontology
(Rector et al 2004).
Rector, Alan .,Nick Drummond, Matthew Horridge, Jeremy Rogers, Holger Knublauch, Robert Stevens, Hai Wang,
Chris Wroe. (2004) OWL Pizzas: Practical Experience of Teaching OWL-DL: Common Errors & Common
Patterns (http://www.co-ode.org/resources/papers/ekaw2004.pdf)
3
Financial Informatics:
Semantic Web and Ontology
‘Constructing correct
definitions of pizzas from
a menu and for a
“vegetarian pizza” so that
the correct pizzas are
classified as “vegetarian”
turns out to be a
surprisingly challenging
exercise’ for creating an
ontology (Rector et al
2004).
Rector, Alan .,Nick Drummond, Matthew Horridge, Jeremy Rogers, Holger Knublauch, Robert Stevens, Hai Wang,
Chris Wroe. (2004) OWL Pizzas: Practical Experience of Teaching OWL-DL: Common Errors & Common
Patterns (http://www.co-ode.org/resources/papers/ekaw2004.pdf)
4
2
Financial Informatics:
Semantic Web and Ontology
A tangled
pizza
toppings
hierarchy.
Rector, Alan ., Nick Drummond, Matthew Horridge, Jeremy Rogers, Holger Knublauch, Robert Stevens, Hai
Wang, Chris Wroe. (2004) OWL Pizzas: Practical Experience of Teaching OWL-DL: Common Errors & Common 5
Patterns (http://www.co-ode.org/resources/papers/ekaw2004.pdf)
Financial Informatics:
Semantic Web and Ontology
A tangled
pizza
toppings
hierarchy.
Rector, Alan,. Nick Drummond, Matthew Horridge, Jeremy Rogers, Holger Knublauch, Robert Stevens, Hai Wang,
Chris Wroe. (2004) OWL Pizzas: Practical Experience of Teaching OWL-DL: Common Errors & Common
Patterns (http://www.co-ode.org/resources/papers/ekaw2004.pdf)
6
3
Financial Informatics:
Semantic Web and Ontology
An initial
hierarchy.
Rector, Alan et al (2004) OWL Pizzas: Practical Experience of Teaching OWL-DL: Common Errors & Common
Patterns (http://www.co-ode.org/resources/papers/ekaw2004.pdf)
7
Financial Informatics:
Semantic Web and Ontology
A correctly
classified
hierarchy.
Rector, Alan et al (2004) OWL Pizzas: Practical Experience of Teaching OWL-DL: Common Errors & Common
Patterns (http://www.co-ode.org/resources/papers/ekaw2004.pdf)
8
4
Financial Informatics:
Semantic Web and Ontology
‘Constructing correct
definitions of pizzas from
a menu and for a
“vegetarian pizza” so that
the correct pizzas are
classified as “vegetarian”
turns out to be a
surprisingly challenging
exercise’ for creating an
ontology (Rector et al
2004).
Rector, Alan ., Nick Drummond, Matthew Horridge, Jeremy Rogers, Holger Knublauch, Robert Stevens, Hai
Wang, Chris Wroe. (2004) OWL Pizzas: Practical Experience of Teaching OWL-DL: Common Errors & Common 9
Patterns (http://www.co-ode.org/resources/papers/ekaw2004.pdf)
Financial Informatics:
Semantic Web and Ontology
10
5
Financial Informatics:
Semantic Web and Ontology
‘Constructing correct
definitions of pizzas from
a menu and for a
“vegetarian pizza” so that
the correct pizzas are
classified as “vegetarian”
turns out to be a
surprisingly challenging
exercise’ for creating an
ontology (Rector et al
2004).
Rector, Alan ., Nick Drummond, Matthew Horridge, Jeremy Rogers, Holger Knublauch, Robert Stevens, Hai
Wang, Chris Wroe. (2004) OWL Pizzas: Practical Experience of Teaching OWL-DL: Common Errors & Common
11
Patterns (http://www.co-ode.org/resources/papers/ekaw2004.pdf)
Financial Informatics:
Semantic Web and Ontology
What counts as a Pizza.
‘Do all pizzas have to
have a base? toppings? Is
a pizza base without a
topping a Pizza? Is
anything with a
Pizza_Base and
Pizza_Toppings a Pizza?
Can we completely define
a Pizza?’ (Rector 2004,
section 5.5)
Rector, Alan ., Nick Drummond, Matthew Horridge, Jeremy Rogers, Holger Knublauch, Robert Stevens, Hai
Wang, Chris Wroe. (2004) OWL Pizzas: Practical Experience of Teaching OWL-DL: Common Errors & Common
12
Patterns (http://www.co-ode.org/resources/papers/ekaw2004.pdf)
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Financial Informatics:
Semantic Web and Ontology
What counts as a Pizza.
‘Do all pizzas have to
have a base? toppings? Is
a pizza base without a
topping a Pizza? Is
anything with a
Pizza_Base and
Pizza_Toppings a Pizza?
Can we completely define
a Pizza?’ (Rector 2004,
section 5.5)
Rector, Alan et al (2004) OWL Pizzas: Practical Experience of Teaching OWL-DL: Common Errors & Common 13
Patterns (http://www.co-ode.org/resources/papers/ekaw2004.pdf)
Financial Informatics:
Semantic Web and Ontology
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Financial Informatics:
Semantic Web and Ontology
We need to exchange information. So we mark
up the key elements of texts:
A markup language is an artificial language using a set of annotations to text that
give instructions regarding the structure of text or how it is to be displayed. Markup
languages have been in use for centuries, and in recent years have also been used in
computer typesetting and word-processing systems.
A well-known example of a markup language in use today in computing is
HyperText Markup Language (HTML), one of the most used in the World Wide
Web. HTML follows some of the markup conventions used in the publishing
industry in the communication of printed work among authors, editors, and printers.
http://ec.europa.eu/taxation_customs/taxation/vat/how_vat_works/index_en.htm
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Financial Informatics:
Semantic Web and Ontology
We need to exchange information. So we
mark up the key elements of texts:
Ontology exchange is envisaged through
mark languages like XML:
The Extensible Markup Language (XML) is a general-purpose
specification for creating custom markup languages. It is
classified as an extensible language, because it allows the user
to define the mark-up elements. XML's purpose is aiding
information systems share structured data, especially via the
Internet, to encode documents, and to serialize data
http://en.wikipedia.org/wiki/XML
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Financial Informatics:
Semantic Web and Ontology
So we know how our world works. How do we tell others in the
agencement what we know? Take the case of value-added tax:
http://ec.europa.eu/taxation_customs/taxation/vat/how_vat_works/index_en.htm
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Financial Informatics:
So we know how our world works. How do we
tell others in the agencement what we know?
Take the case of value-added tax: It takes a 181
page document to just outline the tax.
Semantic Web and Ontology
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2006:347:0001:0118:en:PDF
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Financial Informatics:
Semantic Web and Ontology
Colleagues in the Netherlands have developed an ontology
of European VAT laws. They have used this ontology to
build an information extraction [system]
(i) to assist both tax authorities as well as traders in
extracting specific knowledge about companies.
(ii) […][to] retrieve relevant legislative texts or even
particular sections in VAT law based on specific
concept-queries.
The colleagues claim that the ontology can be used to
support a so-called reader’s assistant in providing extra
VAT-related information about concepts appearing in e.g.
company websites. And to deal with VAT Fraud
http://www.starlab.vub.ac.be/research/projects/poirot/contents/vatontology.htm
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Financial Informatics:
Semantic Web and Ontology
So we know how our world works. How do we tell others in the
agencement what we know? Take the case of value-added tax:
http://www.starlab.vub.ac.be/research/projects/poirot/contents/vatontology.htm
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Financial Informatics:
What is ontology?
Literature on intelligent systems invariably
refers to a thesaurus of domain objects in the
construction of knowledge bases.
A ‘thesaurus’ suggests the existence of a range of
words and phrases associated with a concept.
The names of the objects form the terminology
of the domain.
The organisation of terminology is discussed
under the rubric of ontology.
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Financial Informatics:
What is ontology?
Ontology is a branch of philosophy, and some
philosophers believe that to understand what is in
every area of reality one should look into the theories
of sciences (Quine 1981).
Quine coined the term ontological commitment:
‘scientists and philosophers to seek a comprehensive
system of the world, and one that is oriented to
reference even more squarely and utterly than
ordinary language’.
Quine, Willard, van Omran. (1981). Theories and Things. Cambrdige (Mass) & London: The
Belknap Press of Harvard University Press.
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Financial Informatics:
What is ontology?
“The goal of the Gene Ontology Consortium is to
produce a dynamic, controlled vocabulary that
can be applied to all eukaryotes even as
knowledge of gene and protein roles in cells is
accumulating and changing. To this end, three
independent ontologies accessible on the WorldWide Web (http://www.geneontology.org) are being constructed:
•biological process,
•molecular function and
•cellular component. ”
Michael Ashburner et al (2000). "Gene Ontology: tool for the unification of biology". Nature
Genetics Vol 25, pp 25 - 29
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Financial Informatics:
What is ontology?
Ontology is a branch of philosophy, and some philosophers believe that to understand what is in every area of
reality one should look into the theories of sciences (Quine 1981).
But some folk are rather sceptical of this approach: “Scientific theories
and scientific methods are usually ontologically opaque. Their ontological
commitments, in other words, can rarely be read off unequivocally from
their axioms, principles, or methodological rules.” (Boettke et al 2005:pp
F319).
‘[…] methods and models used by economists are ontologically opaque,
that is, that economists ontological commitments cannot be read directly
off the tools they use.’ (Boettke et al 2005:pp F322).
Boettke, Peter J., Christopher J. Coyne, John Davis, Francesco Guala, Alain Marciano,
Jochen Runde and Margaret Schabas. Where Economics and Philosophy Meet: Review of the Elghar
Companion to Economics and Philosophy with responses from the Authors. The Economic Journal, Vol 116
(June), pp F306–F325
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Financial Informatics:
What is ontology of finance?
Ontology is a branch of philosophy, and some philosophers believe that to understand what is in every area of
reality one should look into the theories of sciences (Quine 1981).
But some folk are rather sceptical of this approach: “Scientific theories
and scientific methods are usually ontologically opaque. Their ontological
commitments, in other words, can rarely be read off unequivocally from
their axioms, principles, or methodological rules.” (Boettke et al 2005:pp
F319).
‘[…] methods and models used by economists are ontologically opaque,
that is, that economists ontological commitments cannot be read directly
off the tools they use.’ (Boettke et al 2005:pp F322).
Boettke, Peter J., Christopher J. Coyne, John Davis, Francesco Guala, Alain Marciano,
Jochen Runde and Margaret Schabas. Where Economics and Philosophy Meet: Review of the Elghar
Companion to Economics and Philosophy with responses from the Authors. The Economic Journal, Vol 116
(June), pp F306–F325
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Financial Informatics:
What is ontology of finance?
How does one define aspects of
ontology of finance/economics?
How does Reuters News Agency
assign categories to their
reports?
http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
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Financial Informatics:
What is ontology of finance?
Indexing news wires Reuters News services use a Coding
Scheme that is updated annually. Three major categories are
being used: Industry, Topic and Region codes are used
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Financial Informatics:
What is ontology of finance?
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Financial Informatics:
What is ontology of finance?
Number of Document
Two major applications:
Indexing news wires Reuters News Feed; Variable news feed: In a sample
over half the news items had less than or equal to 5 codes; 10% had more than 7
codes and some news items had as many as 20 codes
30.00%
25.00%
20.00%
15.00%
10.00%
5.00%
0.00%
1
3
5
7
9
11
13
15
17
19
21
23
25
27
Number of Codes per Document
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Financial Informatics:
What is ontology of finance?
Consider financial business process integration standards: Unified
Business Language (UBL), ISO 20022 (UNIFI), and Interactive
Financial eXchange (IFX), and how a bill is being described in
the three:
Tuomo Mäkelä, Kaisa Rommel, Jukka Uskonen, Tao Wanhttp Towards a Financial Ontology – A Comparison of eBusiness Process Standards. http:////www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
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Financial Informatics:
What is ontology of finance?
http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
31
Financial Informatics:
What is ontology of finance?
In order to systematically
and profitably conduct
business within and across
organisations, it is important
that agents (people,
machines, algorithms) are
able to exchange data and
that the data has meaning
for all the agents involved in
the exchange. exchange
data and keep it meaningful
to everyone involved.
There are sophisticated
technological solutions for
such a meaningful exchange
IBM Crossworlds ‘hub and spoke’ B2B systems
Image from: http://www.ibm.com/developerworks/ibm/library/i-cross/
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Financial Informatics:
What is ontology of finance?
Universal Business Language (UBL) is an
ambitious effort to unify the chaotic world of
XML formats for business: The language
(and the standard) comprises business forms
for placing an order; responding to simple
and complex orders; cancelling an order;
dispatch advice or shipping notice; reciept
advice; and, invoices.
http://www.ibm.com/developerworks/xml/library/x-think16.html
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Financial Informatics:
What is ontology of finance?
Universal Business
Language (UBL) is an
ambitious effort to unify
the chaotic world of XML
formats for business: The
language (and the
standard) comprises
business forms for placing
an order; responding to
simple and complex
orders; cancelling an
order; dispatch advice or
shipping notice; reciept
advice; and, invoices.
An ‘order’ form in eXtensible Markup language (XML)
http://www.ibm.com/developerworks/xml/library/x-think16.html
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Financial Informatics:
What is ontology of finance?
The Interactive Financial eXchange (IFX) specification
is a […] XML-based, financial messaging protocol,
built by financial industry and technology leaders [..].
IFX can be used for
Electronic Bill Presentment and Payment
Business to Business Payments
Business to Business Banking (such as balance and transaction
reporting, remittance information)
Automated Teller Machine communications
Consumer to Business Payments
Consumer to Business Banking
http://www.ifxforum.org/standards/
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Financial Informatics:
What is ontology of finance?
UNIFI is the nickname of ‘ISO 20022 - UNIversal Financial
Industry message scheme’, the platform proposed by ISO to
develop all financial messages.
Objective: To enable communication interoperability between
financial institutions, their market infrastructures and their enduser communities
http://www.iso20022.org//
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Financial Informatics:
What is ontology of finance?
All institutions
have their own
sets of data
objects
ISO standardises
common
data objects
and groups them into ‘syntaxneutral’ message models,
which...
can be ‘transformed’
in message formats in
the desired syntax
ISO 15022
EDIFACT
XML
FIX
SOURCE:http://www.iso20022.org/documents/general/Scripted_UNIFI_(ISO_20022)_presentation_v37.ppt
37
Financial Informatics:
What is ontology of finance?
Ordering
Party
Trade
Counterpart
y
Order
(FIX)
Order
(FIX)
Executio
n (FIX)
Executio
n (FIX)
Trade
Ordering
Counterpart
Party
y
Order
(ISO
15022)
Order
(ISO
15022)
Executing
Party
Execution
(ISO
15022)
Execution
(ISO
15022)
SOURCE:http://www.iso20022.org/documents/general/Scripted_UNIFI_(ISO_20022)_presentation_v37.ppt
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Financial Informatics:
What is ontology of finance?
There are a number of systems that can help with
the integration of business processes, and some are
appearing in the financial industry. However, the
standards are designed for different purposes and
support different processes.
Generation of a high-level ontology would provide
means to enhance the interoperability between
standards and support streamlined processes within
the financial domain.
http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
39
Financial Informatics:
What is ontology of finance?
There are a number of systems that can help with
the integration of business processes, and some are
appearing in the financial industry. However, the
standards are designed for different purposes and
support different processes.
Generation of a high-level ontology would provide
means to enhance the interoperability between
standards and support streamlined processes within
the financial domain.
http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
40
20
Financial Informatics:
What is ontology of finance?
Mäkelä, Rommel, Uskonen and Wan (2007),
based in Helsinki, have asked three research
questions:
1. How do different standards cover the field of
financial information exchange?
2. How are the existing standards constructed and
related to each other?
3. What are the basic requirements for ontology to
support financial B2B integration?
Mäkelä, Tuomo., Kaisa Rommel, Jukka Uskonen, Tao Wanhttp Towards a Financial Ontology – A Comparison of e41
Business Process Standards (available at http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
Financial Informatics:
What is ontology of finance?
Mäkelä, Rommel, Uskonen and
Wan (2007), have used the socalled Upper Level Ontology to
integrate the various process
languages to produce an ontology
of finance.
Mäkelä, Tuomo., Kaisa Rommel, Jukka Uskonen, Tao Wanhttp Towards a Financial Ontology – A Comparison of e42
Business Process Standards (available at http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
21
Financial Informatics:
What is ontology of finance?
Mäkelä, Rommel, Uskonen and Wan (2007), have used the so-called Upper
Level Ontology to integrate the various process languages to produce an
ontology of finance.
Mäkelä, Tuomo., Kaisa Rommel, Jukka Uskonen, Tao Wanhttp Towards a Financial Ontology – A Comparison of e43
Business Process Standards (available at http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
Financial Informatics:
What is ontology of finance?
Mäkelä, Rommel, Uskonen and Wan (2007), have used the so-called Upper
Level Ontology to integrate the various process languages to produce an
ontology of finance.
Mäkelä, Tuomo., Kaisa Rommel, Jukka Uskonen, Tao Wanhttp Towards a Financial Ontology – A Comparison of e44
Business Process Standards (available at http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
22
Mäkelä,
Rommel,
Uskonen
and Wan
(2007),
have used
the socalled
Upper
Level
Ontology to
integrate
the various
process
languages
to produce
an ontology
of finance.
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Financial Informatics:
What is ontology of financial transactions?
Mäkelä, Tuomo., Kaisa Rommel, Jukka Uskonen, Tao Wanhttp Towards a Financial Ontology – A Comparison of e46
Business Process Standards (available at http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
23
Financial Informatics:
What is ontology of tangled financial transactions?
Child of
multiple
parents
Mäkelä, Tuomo., Kaisa Rommel, Jukka Uskonen, Tao Wanhttp Towards a Financial Ontology – A Comparison of e47
Business Process Standards (available at http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
Financial Informatics:
What is ontology of financial account?
Mäkelä, Tuomo., Kaisa Rommel, Jukka Uskonen, Tao Wanhttp Towards a Financial Ontology – A Comparison of e48
Business Process Standards (available at http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
24
Financial Informatics:
What is ontology of financial account that have siblings?
Mäkelä, Tuomo., Kaisa Rommel, Jukka Uskonen, Tao Wanhttp Towards a Financial Ontology – A Comparison of e49
Business Process Standards (available at http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
Financial Informatics:
What is ontology of financial account that have tangles?
Multiple parents!
Mäkelä, Tuomo., Kaisa Rommel, Jukka Uskonen, Tao Wanhttp Towards a Financial Ontology – A Comparison of e50
Business Process Standards (available at http://www.soberit.hut.fi/T-86/T-86.5161/2007/FinancialOntology_final.pdf
25
Central semantic authority
51
www.w3.org/2001/sw/hcls/f2f-2006/presentations/Federation.3.ppt
Hierachical semantics
Devoid of specifics
but very sharable
Very specific but
poorly sharable
www.w3.org/2001/sw/hcls/f2f-2006/presentations/Federation.3.ppt
52
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Federated semantics
53
But just before I go on with rest of my talk -Theories and Things
Ontology is a branch of philosophy, and some philosophers believe that to understand what is in
every area of reality one should look into the theories of sciences (Quine 1981).
Ontology, if understood in its religious sense as ‘what there is’ (a deity
usually), then ontology or rather the ontological commitment as to what
there is fixed for all times – otherwise we will not have a diety!!
So do ontological commitments change
over time within a community and across
communities at fixed point in time
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Financial Informatics:
Special languages and linguistic writing
The growth in the size and complexity of the
vocabulary of a specialist language, and
the concomitant use of limited
grammatical structure, usually
accompanies a growing body of
knowledge (see, for example, Gerr 1943
and Halliday and Martin 1995).
Sentences in specialist writing are usually of
declarative and imperative type.
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Financial Informatics:
Semantic Web and Ontology
Level of
‘knowledge’
INVENTORY/
GLOSSARY
TERMINOLOGY
Elaboration
A collection of glosses; a list with explanations of
abstruse, antiquated, dialectal, or technical terms; a
partial dictionary.
Etymologically, The doctrine or scientific study of terms;
in use almost always, The system of terms belonging to
any science or subject; technical terms collectively;
nomenclature.
TAXONOMY
Classification, esp. in relation to its general laws or
principles; that department of science, or of a particular
science or subject, which consists in or relates to
classification; esp. the systematic classification of living
organisms.
ONTOLOGY
The science or study of being; that branch of metaphysics
concerned with the nature or essence of being or
existence.
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