Thomson Reuters has announced the expansion of its comprehensive psychology-focused analytics suite, building on its existing MarketPsych Indices offering, according to a Thomson Reuters statement.
The newly enriched offering will include individual companies, as well as the indices for countries, currencies, commodities and industries already available to users. The impetus behind the expansion deals with the value of investor perceptions, namely its subsequent effect on financial markets.
Given the constant duality of news and social media seemingly driving investor activity, there exists a substantiated interest in a module that bases itself on trading decisions via emotional responses to the stories circulating around particular companies or sectors.
Thomson Reuters first released MarketPsych Indicies in 2012, having been developed in tandem with MarketPsych LLC, a consultancy focusing on quantitative behavioral economics.
The indices cater to a versatile clientele base, given its easy-to-interpret, real-time linguistic and psychological analysis of news and social media. Furthermore, the indices convert several qualitative indicators, i.e. fear, performance forecasts and trust in management, into quantitative, actionable insight. The newly expanded indices however will constitute coverage of over 7,500 global companies.
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According to James Cantarella, Head of Machine Readable News at Thomson Reuters, in a statement on the expansion, “The addition of company-level Thomson Reuters MarketPsych Indices into our news and text analytics proposition extends our ability to help customers understand the behavior driving financial markets.”
“They act as a powerful complement to the tools and services we already offer in this area, helping our customers draw a comprehensive and sophisticated picture of market dynamics and act with confidence,” he added.
“Thomson Reuters MarketPsych Indices shed light on how global economies and stock prices respond to information. Through the lens of this data we can distinguish when investors overreact to information – generating price reversals – or under-react to news – precipitating trends. This new data helps investment professionals see how markets behave under stress or during trends, and allows them to systematically enhance investment and trading strategies,” noted Richard Peterson, Managing Director of MarketPsych LLC, in an accompanying statement.