What Can Market Sentiment Tell Us?

Markets are made of people—and people are emotional. Behavioral economists have known for some time that emotions drive markets and events. But how can we capture sentiment in a way that is actionable? What decisions might we make with the ability to measure and analyze emotions in real time? How would we better understand the drivers of complex, ongoing events like the Euro Zone crisis?

Data comes from:

Thomson Reuters News Analytics, a tool that makes sense of unstructured news and opinion data and turns it into actionable ideas
Thomson Reuters MarketPsych Indices, a new psychological analysis capability within Thomson Reuters News Analytics that gauges market sentiment by analyzing human emotion in news and social media in order to influence and support investment and trading strategies in financial markets

Expert Insights

A Market Analyst Weighs In

Rich Brown

Head, Quant & Event-Driven Analytics

“In an environment fraught with information overload, where complex events like the Euro Zone crisis can overwhelm trading and investment professionals, Thomson Reuters analytics can turn the mass of unstructured data available in news and social media into manageable information flows and actionable insight. Analyzing text for measures of sentiment and psychological attributes can enable managers to reach beyond traditional market data to get a more complete picture into emerging trends, uncover new opportunities and make better decisions.”

A Financial Columnist’s Perspective

Rob Cox

Editor, Reuters Breakingviews

“Nuance is one of the most underrated qualities in the global marketplace. To some, it suggests waffling, indecision or a lack of clarity. But it is actually between the known and unknown where smart investors make their mark. At Breakingviews, we love this space. We know that news and information is not static, so why should positions be fixed? A year ago, many thought Apple was going to be a $1 trillion company and the Euro Zone would break apart. Both predictions proved false. Investors who were able to grasp the nuances of both stories, as Breakingviews columnists did, could have cut their losses or profited royally.”

Change Into Opportunity