How To Invest?
Ideally, a stock analyst can help you in this endeavor by making objective recommendation to aid in your investment. However, recent studies suggest that most analysts rarely recommends ‘sell’ in sell research reports, pointing to the fact that subjective judgement rather than objective recommendation drives most of them. This can be due to the fear of being denied access to a company if they make negative recommendation about them.
In this business where access is the king, denied access can hamper their job which forces analysts to tread carefully when it comes to the recommendation they dole about. So how do you know when to sell ,hold or buy stocks from the stock reports despite this? Is stock reports worth reading? It is at this juncture Big Data comes into play.
Big Data To Help You Sell Stocks?
Big data literally refers to huge volumes of data – both structured and unstructured. Every business generates it on a daily basis. A close analysis of it can reveal hidden insights and patterns. It is possible for any industry to benefit from Big data provided they know how to use it. Potential investors too can benefit from Big data. Let’s consider the example of one particular analyst’s research reports on a firm to learn how Big data can help. These research reports compiles an exhaustive list of information on the respective firm including data regarding its valuation, financial analysis and possible factors that could undermine investment. A close analysis of the language used while describing these information in report after report by a single analyst could help the investors to gain perspective on what the analyst actually thinks about the company’s progress outside of the recommendation they might be compelled to give.
The use of Big Data to predict stock market outside of its recommendation can be illustrated with the example of Facebook. Facebook stocks are on the verge of bear market owing to the data scandal Facebook is currently involved in. AlphaSense, a financial research tool powered by AI to understand language found after a close analysis of a particular analyst’s reports found that though his stock recommendation regarding Facebook has been pro consistent in several reports made this year, the language used by the analyst became more and more cautious with each report. This highlights how language can reveal what is not blatantly said.
In short, what is implied might be more significant than the recommendation given outrightly. The problem here in going through the massive volume of information available. Trying to manually trace language patterns in the available Big data is not very wise. Emerging technologies in AI and language processing can aid in understanding the context of a given text.
Big data is thus an area that can transform the buying and selling of stocks. It is essential to remember that the value of Big data comes not from the raw data , but from analyzing it and the insights, products and services that emerge from it. Potential investors can profiteer from Big data with a basic understanding of the concept. Thousands of of Big data courses available in the market today. SpringPeople offers one of the best certified Big Data training. You can check it out here