Last week we reviewed the Fintechs using Sentiment analytics, in Europe and the East. We opened up the topic further, asking the Fintech Genome community to share their knowledge on the differentiating factors of each of these Fintechs, their business models and their partnerships. Join the Fintech crowd-sourced and curated process here.
Sentiment analytics, whether focused on NLP (natural language processing) or algorithms that detect patterns from financial or non-financial data Or from structured data or unstructured data; they all aim to produce Social Alpha.
We start this week our journey in New York with the most seasoned in the sentiment space globally, Kensho. They were founded in 2013 and we profiled them more than a year ago on Kensho: Warren is like Watson and Siri, for analysts, investors and traders. They have a laser focus on natural language processing and on producing actionable insights. They maintain their subscription-based partnership with CNBCPro and are used in house from Goldman Sachs, their strategic investor.
Earlier stage Fintechs in the space are:
ISentium in the US, who parses financial tweets and data. They use scientists that apply algorithms processing unstructured financial data. They target hedge funds and any quant DIY trader, looking for predictive analytics.
PsychSignal is focused on detecting moods in trading; a strictly B2B focus for traders and investment professionals that focuses more in mood detection rather than news. So, finding actionable insights without any events.
More focused on news, early bird detection of the effect on the markets, is Contix.
Market Prophit is extracting value from conversations and with a focus on financial bloggers. They process real time data and natural language, to produce bullish/bearish signals and identify buzz themes in the market. They are working in collaboration with Interactive brokers.
HedgeChatter, who covers US stocks with sentiment analysis from news and social media. They offer a unique Manipulation Index that detects stock manipulation from “social attacks”.
Similarly, E-trade is in partnership Tipranks adding to a sentiment and social media angle to the tools the old time disruptor offers.
Ameritrade has developed its own social sentiment offering, Likefolio, which curates Twitter content and offers “color” from the market (trader podcasts, crowd-sourced) research.
Bloomberg and Thomson Reuters, both filter Tweets and financial information; but Fintechs are pushing the frontiers on producing Social Alpha.
Combining sentiment analysis from crowd sourced data & quantum encryption, Running Alpha offers a smarter way for seeing investment opportunities before they get noticed; helping investors be first at exploiting high-impact performance trends with confidence. They offer two sophisticated heat map products classified as Sentiment-Aware Portfolio Solutions: the Grid 100 and Focus 15. A subscription based serviced for retail and asset managers to tap into Social Alpha.
Raven pack is a US based analytics company focused on analyzing Big data for research, trading, and risk management purposes. Discovering the accumulation of undetected sentiment is their focus. I see them with more of a full stack approach to financial analytics through Big Data, including a sentiment analysis element.
The partnership of EidoSearch (using big data analytics for prediction) and Stocktwits, is also generating sentiment based actionable insights.
I see the space still in the early stage. It started with a focus on twitter feeds and news that could serve traders with additional or better signals in their decision-making and risk management. It has now extended to researchers, portfolio managers, and risk managers. Whether these tools will become more mainstream in marco-economic analysis or asset trading; is yet to be seen. The integration with other qualitative and quantitative processes, is tested as we speak.
Daily Fintech Advisers provides strategic consulting to organizations with business and investment interests in Fintech & operates the Fintech Genome P2P Knowledge Network. Efi Pylarinou is a Digital Wealth Management thought leader.