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A 99 percent model that catches nothing, and what to report instead.
12 min read·Lesson 6 of 6·Pro
The 99 percent model that is useless
Fraud detection. Ten thousand transactions, one hundred of them fraudulent. That is one percent.
Here is a model:
Python 3
def detect_fraud(transaction):
return 0 # never fraud
Accuracy: 9,900 correct out of 10,000. 99 percent. It catches zero fraud. It would have been just as accurate if written on paper.
This is not a trick example. Most problems worth solving are imbalanced. Disease screening, fraud, equipment failure, students at risk of dropping out: the interesting class is always the rare one.
Measure it properly
The rest of this lesson is Pro
The free lessons of Machine Learning Foundations finish what
they start — read those first if you have not. This one goes further, and it
is part of the paid half.
A pass opens the paid lessons of every course, the mock test papers
and the company-wise series. It ends on its own date; nothing renews by itself.