Harness the Power of Sentiment with
We extract those news items that are relevant for your investment universe and create aggregate weekly or daily sentiment indicators customized to your equity, corporate bond or commodity portfolios. We use proprietary state-of-the-art signal processing algorithms and consider the news novelty, relevance, its type and volume.
We back test your sentiment-based strategies on historical data and help you choose the right sentiment signals for your investment goals, whether it is return enhancement, risk reduction, limiting the downside or effective diversification.
In the past few weeks, the sentiment surrounding main stock markets has improved and is looking quite strong and stable. Our PSIs – Probability Sentiment Indices – indicate no reason to unwind your equity holdings in all major stock indices.
Welcome to our renewed PSI webpage, containing Weekly PSI Forum, where we now publish weekly Probability Sentiment Indicators and their week-on-week changes for S&P500, FTSE and EUROSTOXX:
Which sentiment indicators shall we add to our Weekly PSI Forum? Energy, commodities, crude oil, or maybe other stock markets? Please send us your ideas and wishes!
For many investors, the continual question is: equity or cash? In other words, in what (risky) situations do I exit my diversified stock positions and convert them into cash? Probability Sentiment Indicators (PSI) continuously monitor media sentiment about major stock indices and can provide a timely answer to this question. For the past few months, we saw that PSIs for all major stock indices (US, EU and UK) have recovered and have been stable, giving no indications for unwinding your diversified equity investments.
PSIs for major stock indices (S&P500, Eurostoxx and FTSE100) have shown consistent recovery since the dramatic dip in the spring of 2020. However, Eurostoxx 600 and FTSE100 sentiment has declined slightly in the past week, on the recent lacklustre performance of European markets and worries about vaccination in EU. At Probability, we monitor daily Probability Sentiment Indicators (PSI), powered by #Refinitiv News Analytics.
By February 28th, 2020, the S&P500 has plummeted for 6 days in a row on coronavirus related fears.
At Probability & Partners, we monitor news sentiment related to stock markets. As of January 27th, 2020, our Probability Sentiment Indicator (PSI) for the S&P500, powered by #Refinitiv Machine Readable News, signaled a rapid and sustained decline, triggered by sentiment analysis of stock-related news. This collapse in PSI predated the actual plunge in S&P500 by more than three weeks, as shown in the graph. Retrospective analysis shows it was related to the anticipated effect on business of coronavirus that impacted the PSI scores.
Since 2016 we have demonstrated that Sentiment Indicators such as SenSR are effective risk indicators for financial markets. The coronavirus shock provides further compelling evidence of the power of sentiment in signaling significant market downturns.
March 3, 2021
In this webinar, we explore ways of adding news and social media sentiment to factor investment strategies.
March 19, 2020
Motivated by the current market upheaval due to the coronavirus, Dr Borovkova shows how sentiment extracted from news and media can be used to signal global distress, as well as downturns in less dramatic circumstances, such as sector- or stock-specific price declines.
On the graphs, the weekly Probability Sentiment Indices for major stock indices (S&P 500, FTSE 100, EUROSTOXX 50 and 200), since January 2020, are shown in blue (in yellow, the indices themselves are shown). Recall that PSI is the net positive aggregated media sentiment for assets in the corresponding index.
The dynamics of the indices are more informative than their absolute levels. The current PSI levels and last week’s changes in sentiment are given above the graphs. Use tabs above the graphs to browse through the indices.
The quant team at Probability & Partners is headed by Dr. Svetlana Borovkova: a leading expert in sentiment analysis for finance and a long-term partner and preferred consultant of Refinitiv in the area of sentiment analysis.
Probability & Partners has over a decade of experience with sentiment analysis for finance. We provide custom-made sentiment analytics for the investment and trading community. Our indicators monitor sentiment about your customized portfolios or investment universe and deliver actionable trading and investment signals that can be incorporated into your existing processes and systems.
We offer strong and valid quantitative models to transfer the outputs of Natural Language Processing (NLP) to a denoised and aggregated sentiment index. Our expertise in news sentiment and quantitative modeling builds the bridge between different news and social media data to the sentiment score of equities, commodities, stock indices, etc. We help you use all kinds and sources of news data to its full potential.
Refinitiv is a global provider of financial markets data and infrastructure. Refinitiv News Analytics is a major news sentiment engine, powered by Reuters news, that provides sentiment and other quantitative measures for thousands of companies and all commodities in real-time. Our partnership with Refinitiv as the preferred sentiment data provider is backed by a decade of academic research and a long history of jointly helping clients to utilize sentiment data in their investment process.