What is the importance of sentiment analysis in finance?
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Sentiment analysis is important in finance as it allows for the analysis of emotions and opinions expressed in online texts, such as financial news articles and social media posts. It helps in understanding the sentiment polarity of various targets, such as company entities, in a sentence, which is crucial for targeted sentiment analysis. Sentiment analysis can be used to improve forecasting in financial markets by incorporating sentiment scores derived from natural language sentences. These sentiment scores can be used as views in portfolio optimization models, resulting in better performance. Additionally, sentiment analysis can provide valuable information about investor sentiment, which has been found to be positively correlated with stock excess return. It also helps in understanding the impact of events and crises on the language used in financial journalism, shedding light on how sentiment and emotion are conveyed during such periods.
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| Papers (4) | Insight |
|---|---|
| Sentiment analysis in finance is important as it influences market perceptions and reactions, and can provide insights into how crises reshape the linguistic landscape of the industry. | |
| Sentiment analysis in finance is important as it allows researchers to extract valuable information from social platforms promptly and accurately. | |
2 Citations | Sentiment analysis in finance is important because it helps in understanding the sentiment polarities of various targets (e.g., company entities) in a sentence, which is crucial for making informed financial decisions. |
| Sentiment analysis in finance is important as it can improve forecasting of stocks and be used as a new "view" in portfolio optimization. |
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