Market sentiment is usually a blurred expression, because it appeals subjective appreciations about investors and markets and non-defined explanations about their actions. Everything that is weird is linked to “market sentiment”. However, market sentiment exists and it can be analysed in a useful way for investment strategies. Artificial Intelligence and computing tools, as Natural Language Processing and Machine Learning help us measure it and get interpretations to take decisions based on unbiased data.
Is it only a solution for professionals? No, T-Advisor has added a new feature in the interface to offer market sentiment data. How does it work? We have developed our own algorithm that reads all texts from Twitter and Google News related to listed companies in a market. Then, it measures the positive, neutral or negative meaning associated to those texts and words and the companies and translates into points from 0 to 10. Every T-Advisor user can see a ranking with the top-5 expressions and words for each company.
At the end, the algorithm produces a sentiment score. Our platform provides a chart where each company appears in a place depending their combination between sentiment score and the T-Advisor score. Both figures are compared, one related to subjective sentiment and one based on quantitative analysis. So, investors can watch at a glance all companies: the better companies are the ones with higher T-Advisor score and sentiment score, that means, on the upper right side of the chart.
This historical chart shows the evolution of the market sentiment through Natural Language Processing against the price of the asset. As it is easy to perceive, market sentiment is an advanced indicator of the price.
Currently, the solution is working only in English for listed companies in Nasdaq and FTSE, but it will be progressively applied for more international markets and other languages. Additionally, every top-5 market sentiment expressions about a company is linked to its own T-Report. This is just a tasty bite about what T-Advisor offers their users to take the best investment decisions with top information from the cutting-edge technology for finances.
Many could wonder if this market sentiment feature is useful for their investment strategies. Of course, it is! Because what is spoken or published about a company may predict future trends and anticipate to markets. This kind of information was available only in expensive and exclusive delivery reports. Technology has contributed to democratise access to this data and offer the same opportunities for small investors to maximise their returns.
T-Advisor has done it again!
See original blog: https://www.techrules.com/get-anticipated-with-our-new-market-sentiment-tool/
TechRules is a leading consultancy and wealth management software provider for financial entities, focused on the digital transformation in financial services. For more than 20 years TechRules has developed cutting-edge modular and scalable solutions for the whole financial sector: retail and personal banking, private wealth managers, fund managers, IFAs and family offices. TechRules’s flagship solution is Tower: a global comprehensive platform built up with APIs to respond to any final customer demand and to any management process.
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